Economics · Public Economics
Assertion (A): A proportional income tax can be made progressive in its effective incidence if low-income households receive larger lump-sum transfers from the government. Reason (R): Progressivity is determined solely by the statutory tax rate schedule, not by the net fiscal treatment of households. Select the correct code:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A is false but R is true
- 2A is true but R is false✓
- 3Both A and R are true, but R is not the correct explanation of A
- 4Both A and R are true, and R is the correct explanation of A
Correct answer
A is true but R is false
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