The presence of externalities favors ________ and the presence of other distortionary taxes favors ________.
A. nonneutral taxes; neutral taxes
B. neutral taxes; nonneutral taxes
C. nonneutral taxes; nonneutral taxes
D. neutral taxes; neutral taxes
Answer: C
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Can a firm's average cost be rising if it is greater than the firm's marginal cost? Explain
According to Friedman's permanent income hypothesis, which of the following statements about transitory income is true?
a. It reflects the unexpected gains of income are transitory income. b. It reflects the income of people who have temporary employment. c. People's consumption depends on transitory income. d. It reflects the income of retired people. e. Habitual losses (or gains) at gambling are transitory income.
Which of the following is most likely to represent causality rather than association?
A. In years that fashion dictates wider lapels on men's jackets, the stock market grows by at least 5 percent. B. Interest rates are higher in years ending with a 1 or a 6. C. Unemployment falls when the AFC champion wins the Super Bowl. D. Quantity demanded goes up when price falls because lower prices increase consumer purchasing power, ceteris paribus.
WTO rules allow subsides
A) when there are external economies. B) of "precompetitive" activities such as research. C) when there are internal economies. D) when there are positive externalities in production.