What Circumstances Favor Nonneutral Taxes

question 209

Multiple Choice

What circumstances favor nonneutral taxes?

• A) only the presence of externalities
• B) only the presence of other distortionary taxes
• C) both the presences of externalities and other distorting taxes
• D) both inelastic demand and the presence of externalities

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Definitions:

Permissive

A parenting style characterized by low demands with high responsiveness, where parents are more lenient and may act more like a friend than a traditional authoritative figure.

Own Decisions

The act of making choices independently, reflecting personal judgment or preference.

Authoritarian

A governing or parenting style characterized by strict discipline and an expectation of obedience without question.

"Because I Say So"

A style of authoritarian parenting where demands are made without explanation or justification to the child.