Caroline Earns More Than John

question 152

Multiple Choice

Caroline earns more than John. Under a new tax system, some of the taxes paid by Caroline would go to John. A libertarian would

• A)support the system because an extra dollar earned by Caroline would be worth less to her than an extra dollar given to John.
• B)oppose the system if it redistributed income in the presence of equal opportunity.
• C)oppose the system because an extra dollar earned by Caroline would be worth more to her than an extra dollar given to John.
• D)support the system if it maximized the well-being of the poorest member of society.

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Definitions:

Accounts Payable

Debts of a business to creditors arising from the acquisition of goods and services on credit.

Purchases on Account

Transactions where goods are bought and the payment is deferred to a future date, often recorded in accounts payable.

Supplies Account

An account used in accounting to track the amount spent on supplies that have not yet been used or consumed by the business.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities or equity on a company's balance sheet.