A lump-sum tax
a. is most frequently used to tax real property.
b. does not distort incentives.
c. distorts incentives more than any other type of tax.
d. is the most fair tax.
b
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The long run is a time period that is
A) five years or longer. B) long enough to change the amount of labor employed. C) long enough to change the size of the firm's plant and all other inputs. D) long enough to change the amount of labor employed but not to change the size of the plant. E) None of the above answers describes the long run.
When the aggregate demand curve and the short-run aggregate supply curve intersect,
A) the economy is in short-run macroeconomic equilibrium. B) inflation must be increasing. C) structural and frictional unemployment equal zero. D) the long-run aggregate supply curve must also intersect at the same point.