If a Tax System Is Poorly Designed,it May Be Possible

question 41

Multiple Choice

If a tax system is poorly designed,it may be possible to increase:

• A)efficiency without sacrificing equity.
• B)equity while causing inefficiency.
• C)efficiency by sacrificing equity.
• D)equity without causing inefficiency or increase efficiency without sacrificing equity.

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Definitions:

Merchandise

Merchandise consists of goods that a retailer purchases to sell to its customers for profit.

Journalize

The process of recording financial transactions in a company's journal as part of the accounting cycle.

Medicare Tax

A federal tax that funds Medicare, the U.S. healthcare program for individuals older than 65 or with certain disabilities, deducted from employee paychecks.

Social Security

A government program that provides financial assistance to people with an inadequate or no income, especially the elderly, disabled, and unemployed.