Two Countries Are the Same,except One Is Poorer

question 47

Multiple Choice

Two countries are the same,except one is poorer.Assuming the traditional assumption about the production function is made there are

• A)diminishing returns to capital so the poor country grows slower.
• B)increasing returns to capital so the poor country grows slower.
• C)diminishing returns to capital so the poor country grows faster.
• D)increasing returns to capital so the poor country grows faster.

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Definitions:

Illegal Goods

Products or services whose production, sale, or possession is prohibited by law.

Legal System

A legal system encompasses the rules, statutes, and regulations instituted by a government to regulate behaviors, enforce rights, and resolve disputes.

Incidence of Tax

The analysis of who bears the economic burden of a tax, considering how the tax affects the distribution of economic welfare.

Tax Burden

The impact of taxes on an individual or entity, measured by the total amount of tax payments relative to income or profits.