Taxes lead to a loss of beneficial trades.

Question

Quizplus · Accepted Answer

Taxes increase the cost of doing business, which can discourage beneficial trades and transactions. This is because higher taxes reduce the potential gains from trade, making it less profitable for individuals and businesses to engage in mutually beneficial transactions. As a result, some transactions that would have occurred in the absence of taxes may not happen, leading to a loss of potential value and economic efficiency.

Taxes Lead to a Loss of Beneficial Trades