
The figure above shows the U.S. production function.
-How would an increase in income taxes be shown in the figure?
A) an upward shift or rotation of the production function
B) a movement from point C to point B
C) a downward shift or rotation of the production function
D) a movement from point A to point B
E) None of the above because the effects of an increase in taxes cannot be shown in the figure.
Correct Answer:
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