An increase in the income tax rate leads to a large increase in deadweight loss if ________.
A) the labor supply curve is highly elastic
B) the labor supply curve is perfectly inelastic
C) the labor demand curve is elastic
D) the labor demand curve is perfectly inelastic
Question 2
The agreement between the United States, Mexico, and Canada that sought to lower trade barriers is known as
A) the General Agreement on Tariffs and Trade.
B) the North American Free Trade Agreement.
C) the World Trade Organization.
D) the Smoot-Hawley Tariff Act.
E) the New World Free Trade Agreement.
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