Using the "It's not fair if the result isn't fair" principle of fairness, an income tax designed to transfer wealth from the rich to the poor
A) increases efficiency and equity.
B) increases efficiency and does not affect equity.
C) decreases efficiency and increases equity.
D) decreases efficiency and equity.

Question

Quizplus · Accepted Answer

Transferring wealth from the rich to the poor through income tax can decrease efficiency due to potential disincentives to earn more, but it increases equity by redistributing resources to achieve a fairer outcome.

Using the "It's Not Fair If the Result Isn't Fair