Which of the Following Statements Is True

question 209

Multiple Choice

Which of the following statements is true?

• A)Taxing the wealthy will lead to a more efficient economy.
• B)Taxing the poor will lead to a more equal distribution of income.
• C)A basic trade-off exists between the goals of equity and efficiency for a society.
• D)The forces of supply and demand will automatically lead to an equitable distribution of income.

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Definitions:

Marginal Costs

The uplift in total financial outlay required for the making of another unit of a product or service.

Cournot Duopolists

Firms in a market where only two producers exist and compete under the Cournot assumption, where each firm decides its production level assuming the output of its competitor is fixed.

Demand for Wine

The total quantity of wine that consumers are willing and able to purchase at various prices within a specific time period.

Imports

Goods and services purchased from other countries for domestic consumption, often contrasted with exports.