Legalizing all forms of illegal activities
A)reduces GDP and the size of the underground economy.
B)reduces GDP and increases the size of the underground economy.
C)increases GDP and reduces the size of the underground economy.
D)increases GDP and increases the size of the underground economy.

Question

Quizplus · Accepted Answer

Legalizing all forms of illegal activities would increase GDP as now these activities would be a part of the formal economy and generate revenue through taxes. This would also reduce the size of the underground economy as more activities move into the formal sector.

Legalizing All Forms of Illegal Activities