Which of the Following Is a CORRECT Statement

question 390

Multiple Choice

Which of the following is a CORRECT statement?

• A) Producer surplus is an external benefit.
• B) Consumer surplus is an external benefit.
• C) A government subsidy paid to a producer is an external benefit.
• D) None of the above statements are correct.

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Definitions:

Qualified Residence Interest

Interest paid on a mortgage for a primary or secondary residence, which can be deductible for taxpayers who itemize deductions.

Deductibility

The extent to which an expense can be subtracted from gross income to reduce taxable income and lower the tax liability.

Written Acknowledgment

A written statement confirming the receipt of something, often used in tax documentation for charitable donations.

Charitable Organization

A nonprofit entity that operates to perform charitable acts, provide education, religious, or public service activities, eligible for tax-exempt status under the IRS.