Asked by
Aimee Cheng
on Nov 05, 2024Verified
The optimal taxation system is a tax system that
A) is highly progressive.
B) minimizes the overall excess burden.
C) minimizes the total tax burden.
D) maximizes tax revenues.
Optimal Taxation
The theory or practice of determining the most efficient and effective way of levying taxes to generate government revenue with minimal economic distortion or inefficiency.
Excess Burden
The societal expense resulting from market inefficiency, which arises when supply and demand are not in balance.
Progressive
A term often used in the context of taxation or political ideology, indicating policies or stances that aim to redistribute resources from the more affluent to the less affluent.
- Identify the characteristics of an optimal taxation system.
Verified Answer
CD
Learning Objectives
- Identify the characteristics of an optimal taxation system.