Multiple Choice
Which statement about taxes is INCORRECT?
A) Taxes in markets always cause deadweight losses.
B) If the good causes an external cost, taxes actually reduce deadweight loss.
C) Both taxes and tradable allowances in a market that has external costs can lead to the efficient quantity.
D) Taxes on producers cause the supply curve for the product to shift to the left.
Correct Answer:
Verified
Correct Answer:
Verified
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