Which Statement Best Describes Most Economists' Attitudes Toward Corrective Taxes

question 140

Multiple Choice

Which statement best describes most economists' attitudes toward corrective taxes and direct regulation

• A)Corrective taxes are often preferred over direct regulation because they typically reduce externalities at a lower cost.
• B)Corrective taxes are less preferred than direct regulation because they typically reduce externalities at a higher cost.
• C)Corrective taxes are often preferred over direct regulation because they typically reduce externalities at a faster rate.
• D)Corrective taxes are less preferred than direct regulation because they typically reduce externalities at a slower rate.

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Definitions:

Marketable Securities

Short-term financial instruments that can be quickly converted into cash at a reasonable price, like stocks and bonds.

Treasury Bill

A short-term government security issued at a discount from the face value and pays no interest.

Commercial Paper

An unsecured, short-term debt instrument issued by corporations, typically for financing accounts receivable and inventories.

Certificates of Deposit

A savings certificate with a fixed maturity date and specified fixed interest rate, often issued by banks.