Multiple Choice
Labor taxes may distort labor markets greatly if
A) labor supply is highly inelastic.
B) many workers choose to work 40 hours per week regardless of their earnings.
C) the number of hours many part-time workers want to work is very sensitive to the wage rate.
D) "underground" workers do not respond to changes in the wages of legal jobs because they prefer not to pay taxes.
Correct Answer:
Verified
Correct Answer:
Verified
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