While Debate Over Tax Policy Is Complex,how Do Economists Play

question 33

Multiple Choice

While debate over tax policy is complex,how do economists play an important role

• A)by arguing for policies that clearly lead to efficiency gains in the economy
• B)by shedding light on the tradeoff between efficiency and equity in tax policy
• C)by articulating the importance of equity as the most important goal of tax policy
• D)by demonstrating that there are no tradeoffs in tax policy: both efficiency and equity can be attained if the tax policy follows basic economic reasoning

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Definitions:

Nominal Exchange Rate

The exchange rate at which the currency of one nation can be exchanged for the currency of another nation, without considering inflation adjustments.

Purchasing-Power Parity

An economic theory that compares different countries' currencies through a basket of goods approach, to evaluate the relative purchasing power.

Aruban Florin

The currency of Aruba, symbolized as Afl., used within its economic transactions.

Thai Bhat

The currency of Thailand.