If we compare the United States to France,we see that potential GDP per person in France is ________ than that in the United States because the French ________ is greater than that in the United States.
A) greater; tax wedge
B) less; structural deficit
C) less; tax wedge
D) less; MPC

Question

Quizplus · Accepted Answer

The tax wedge in France is greater than that in the United States, meaning that a larger portion of income is taken out in the form of taxes. This reduces the disposable income of individuals and can lead to lower potential GDP per person. Therefore, the potential GDP per person in France is less than that in the United States.

If We Compare the United States to France,we See That