Which of the following statements is true?

A) When the forces of supply and demand determine for whom goods are produced in a society,an equitable distribution of income will naturally result.
B) An external cost will occur when some of the benefits derived from production of some good or service are enjoyed by a third party.
C) One of the roles of our government is to transfer some income from the rich and the middle class to the poor.
D) According to most economists' definition of competition,the American economy is very competitive.

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Michaela Mason · Accepted Answer

Final Answer : C, Explanation :  C) is correct because one of the roles of government in many economies, including the United States, is to redistribute income through various means such as taxation and social welfare programs, aiming to reduce poverty and inequality. This is achieved by transferring some income from wealthier segments of society to support those with lower incomes.

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