If Horizontal Equity Is Achieved in Taxation

question 39

Multiple Choice

If horizontal equity is achieved in taxation,

• A)vertical equity will also be achieved.
• B)individuals of equal economic capacity will pay equal taxes.
• C)a flat-rate tax will be used.
• D)the tax system will not result in losses in efficiency in markets.

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Definitions:

Prepaid Expenses

Expenses paid for in advance and recorded as assets until they are actually used or consumed.