Taxes distort economic behavior because they
A) change the composition of income and spending.
B) cause deviations in economic behavior from the efficient, free-market outcome.
C) change the balance between private and public expenditures.
D) change the composition of consumption, investment, government spending, and net exports.
B
Economics
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The situation in which the marginal product of labor is greater than zero and declining as more labor is hired is called the law of: a. negative response
b. inverse return to labor. c. diminishing returns. d. demand.
Economics
In the classical view, if desired saving exceeds desired investment
A) the interest rate would increase. B) government spending must rise. C) government spending must fall. D) the interest rate would decline.
Economics