As government becomes larger and larger as a share of the economy, economic growth is likely to decline because
A) taxes are reduced to levels that are inconsistent with economic efficiency.
B) governments are involved in many activities for which they are ill-suited.
C) tax-transfer activities are reduced and sometimes virtually eliminated.
D) governments do not spend enough on the provision of key public goods like education.

Question

Quizplus · Accepted Answer

Governments often engage in activities that may not be efficiently managed compared to the private sector, leading to inefficiencies and reduced economic growth.

As Government Becomes Larger and Larger as a Share of the Economy