Which of the Following Programs Would Redistribute Consumer Surplus in Favor

question 8

Multiple Choice

Which of the following programs would redistribute consumer surplus in favor of those with less surplus in an otherwise free market economy?

• A) Providing welfare payments to the poor that are paid for by income taxes
• B) Enforcing existing property rights
• C) Ensuring that the market results in an efficient outcome
• D) Eliminating estate taxes

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Definitions:

Cost Method

An accounting method used to record investments in which the investment is recorded at cost and dividends are recognized as income.

Dividends

Dividends are payments made by a corporation to its shareholder members, distributing a portion of the company's earnings.

Investment in Grub

The act of putting money into Grub (assuming Grub is a specific entity or company), expecting future financial returns.

Goodwill

The intangible asset that arises when a company acquires another business for a price higher than the fair value of its net identifiable assets.