Which of the Following Efficiency Conditions Is Violated with the Imposition

question 87

Multiple Choice

Which of the following efficiency conditions is violated with the imposition of a sales tax on one good in a perfectly competitive economy?

• A)efficiency in product mix
• B)efficiency in production
• C)efficiency in distribution
• D)efficiency in consumption

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Definitions:

Cost

The amount of money or resources expended to acquire an asset, produce a product, or operate a business activity.

Stockholders' Equity

After subtracting liabilities, the remaining interest in a company's resources represents the stake owned by its shareholders.

Net Income

The company's overall earnings following the deduction of all expenses, taxes, and costs from the gross revenue.

Overstated

A condition where the value or quantity of something is represented to be more than it actually is.