Use the circular flflow diagram to show how each of the following government actions simultaneously affects the allocation of resources and the distribution of income:a. The construction of a new high school.b. A 2-percentage-point reduction of the corporate income tax.c. An expansion of preschool programs for disadvantaged children.d. The levying of an excise tax on polluters.

Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
ChapterST1: Government Spending And Taxation
Section: Chapter Questions
Problem 2CQ
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Use the circular flflow diagram to show how each of the following government actions simultaneously affects the allocation of resources and the distribution of income:
a. The construction of a new high school.
b. A 2-percentage-point reduction of the corporate income tax.
c. An expansion of preschool programs for disadvantaged children.
d. The levying of an excise tax on polluters.

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