Which of the following arguments support the proposition that society should accept at least some income inequality?
A) Income redistribution will require taxation, causing inefficiently low levels of labor supply and saving, thus decreasing the size of the economic pie.
B) Administrative costs associated with income redistribution imply that low-income people receive less than $1 for each dollar taken from high-income people.
C) Income redistribution programs divert skilled labor and capital to tax compliance activities and away from production of goods and services that people value.
D) All of the above answers are correct because all support the proposition that society should accept some income inequality.

Question

Quizplus · Accepted Answer

All the arguments presented (A, B, and C) suggest that income redistribution can lead to inefficiencies and costs that might outweigh the benefits, thus supporting the idea that some level of income inequality could be acceptable to maintain economic efficiency and growth.

Which of the Following Arguments Support the Proposition That Society