Which of the Following Statements Is Not Correct

question 505

Multiple Choice

Which of the following statements is not correct?

• A)A gasoline tax can be an example of a tax that uses the benefits principle.
• B)A progressive tax attempts to achieve vertical equity.
• C)A progressive tax can be an example of the ability-to-pay principle.
• D)A regressive tax attempts to achieve vertical equity.

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Definitions:

Typical Firm

A typical firm refers to an average or representative entity in an industry characterized by the industry's common practices, production processes, and competitive strategies.

Consumer Surplus

The amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it.

Monopolistically Competitive Price

Refers to the price level set by firms in a monopolistically competitive market, where many firms sell products that are differentiated from one another and not perfect substitutes.

Price Increases

A rise in the cost of goods or services, often measured by the rate of inflation.