Which of the Following Statements Does Not Describe the Keynesian

question 7

Multiple Choice

Which of the following statements does not describe the Keynesian standard of tax efficiency?

• A) An efficient tax encourages economic growth.
• B) An efficient tax encourages full employment.
• C) An efficient tax encourages price-level stability.
• D) All of these describe the Keynesian standard of tax efficiency.

---

Definitions:

Output

The quantity of goods or services produced by a firm, industry, or economy within a certain period.

Per-Unit Cost

The cost associated with producing one unit of a product, calculated by dividing total production costs by the number of units produced.

Diseconomies of Scale

The situation where a company or business grows so large that the costs per unit increase, typically due to inefficiencies.

Economies of Scale

Economies of scale describe the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.