Which of the Following Is Not a Potential Problem with Tax

question 40

Multiple Choice

Which of the following is not a potential problem with tax expenditures?

• A)They compromise tax system fairness.
• B)They make the tax structure less efficient.
• C)They increase the political costs of the tax system.
• D)They cause taxpayers to substitute towards favored activities.

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Definitions:

Automobile

A wheeled motor vehicle used for transportation, typically carrying passengers.

Competition

A market condition where various sellers vie to attract customers by offering better terms, services, or goods.

Specialization

The process of focusing effort and resources on a specific task or area of production to increase efficiency and expertise.

Trade

The exchange of goods, services, or both within or between countries.