If Guy Lafleur is taxed $100 on an income of $1,000 . Patrick Roy is taxed $200 on an income of $2,000 . and Ryan Walter is taxed $300 on an income of $3,000 . the tax system is

Which of the following statements is TRUE?

A) The presence of positive economic profit in a perfectly competitive market is consistent with the characteristics of a long-run competitive equilibrium. B) When firms in a perfectly competitive market incur economic losses, some will exit in the long run, thereby shifting the industry supply curve rightward. C) If a profit-maximizing firm in a perfectly competitive market is making an economic profit, then it must be producing at a level of output where price is greater than average total cost. D) If a profit-maximizing firm in a perfectly competitive market is incurring an economic loss, then it must be producing at a level of output where price is greater than average total cost.

Refer to the Article Summary. The article discusses income inequality, and for some people this means a more equitable distribution of income is needed in the economy. Would an equitable distribution of income necessarily be the most efficient distribution of income?

A) No, it is impossible to have an economically efficient distribution which is also an equitable distribution. B) No, an economically efficient distribution of income would not necessarily be equitable. C) Yes, in order for the distribution to be equitable, it must also be efficient. D) Yes, equitable and efficient are two different words which have the same definition.