If Higher Taxes Raise the Unit Cost of a Competitive

question 79

Multiple Choice

If higher taxes raise the unit cost of a competitive industry, then producers

• A)decrease production in the short run and the number of producers decreases in the long run.
• B)decrease production in the short run and the number of producers increases in the long run.
• C)increase production in the short run and the number of producers decreases in the long run.
• D)increase production in the short run and the number of producers increases in the long run.
• E)keep production constant in the short run and the number of producers remains the same in the long run.

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Definitions:

Global Development

The process of economic, social, and political improvements that contribute to a better quality of life for people across different countries and regions around the world.

Rich

Possessing substantial wealth or resources, enabling a person to live a lifestyle of financial comfort and abundance.

Poor

A term used to describe individuals or groups who lack financial resources or sufficient income to meet basic living necessities.

Newly Industrialized Countries

Countries that are transitioning from primarily agricultural to primarily manufacturing and industrial activities.