Which of the Following Is an Example of an Unintended

question 108

Multiple Choice

Which of the following is an example of an unintended consequence?

• A) Competition between two businesses causes each to lower prices.
• B) A tax rebate on electric cars results in increased household electricity consumption.
• C) A tax cut leads to a spike in consumer spending.
• D) Low interest rates encourage businesses to borrow money from banks.
• E) A welfare program causes individuals to purchase necessities and seek employment.

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Definitions:

Discount

A reduction applied to the normal selling price of goods or services, usually offered as an incentive to encourage purchase.

Common Stock

Equity ownership in a corporation, with voting rights and eligibility to receive dividends.

Cash

Currency available for use in transactions or deposits, represented by coins or banknotes.

Paid-in Capital in Excess

The amount of shareholder equity that exceeds the par value of the shares issued.