Which of the Following Is True About a Lump-Sum Tax

question 29

Multiple Choice

Which of the following is true about a lump-sum tax?

• A)It prevents efficiency from being attained in competitive markets.
• B)It causes substitution effects.
• C)It causes income effects.
• D)It causes both income effects and substitution effects.

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Definitions:

Authoritarian

A leadership style characterized by strict control, lack of participative decision-making, and a top-down approach to directives and policies.

Democratic

Relating to or supporting democracy or its principles, where power is vested in the hands of the people, often through elected representatives.

Formal Position

An officially recognized or established role within an organization, typically accompanied by specific duties, responsibilities, and levels of authority.

Legitimate Power

A form of authority where power is granted through an organizational structure or societal norms.