Which of the following is NOT a way that economic growth is often harmed when corruption is widespread?
A) Innovation may not occur when connections with government officials rather than new types of products are the factors that open doors for a business to expand sales.
B) When bribes are paid frequently, the cost of doing business is higher.
C) When political connections provide advantages to favored firms, the favored firms lose incentive to operate as efficiently as possible.
D) Taxes are raised on everyone, which adds the efficiency of all firms.
Correct Answer:
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