Which of the Following Describes a Distribution of Outcomes Based

question 6

Multiple Choice

Which of the following describes a distribution of outcomes based on equity?

• A)People who purchase small, fuel efficient vehicles get a gas tax break.
• B)everyone pays the same gasoline tax, regardless of their vehicle.
• C)people with expensive vehicles pay higher gas tax than people with cheap vehicles.
• D)people who need more gas just to do their jobs pay less gas tax.

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Definitions:

Economic Profit

Total revenues minus explicit and implicit costs, representing the return on investment beyond the normal expected return.

Normal Profit

The level of profit that is necessary for a company to remain competitive in the market, often seen as the minimum acceptable return.

Allocative Inefficiency

A situation where resources are not allocated optimally, leading to a loss of economic efficiency.

Marginal Cost

The incremental cost involved in producing one more unit of a good or service.