Which of the Following Illustrates the Principle of Second Best

Multiple Choice

Which of the following illustrates the principle of second best?

A) The government imposes taxes on cigarettes and the tax revenue collected is used to pay for health care.
B) The government decides to impose taxes on all automobiles rather than imposing a tax only on luxury automobiles.
C) The government imposes a tax on a meat processing plant that equals the cost of cleaning the lake damaged by the waste discharged into the lake by the meat processor.
D) A tax imposed on land, because this tax distorts economic decisions less than taxes on other factors of production.