The argument that each person should pay taxes according to how well the individual can shoulder the burden is called
a. the ability-to-pay principle.
b. the equity principle.
c. the benefits principle.
d. regressive.
a
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If the economy receives an influx of new workers from immigration,
A) we will move down along the long-run aggregate supply curve. B) we will move up along the long-run aggregate supply curve. C) the long-run aggregate supply curve will shift to the right. D) the long-run aggregate supply curve will shift to the left.
Suppose there is a high inequality in household income between the highest and the lowest income groups in one country. In response, the government raises the income tax for the highest income group and provides subsidies to the lowest-income group. What
would happen to the Lorenz curve as a result of the government programs? Explain. What will be an ideal response?