Give the correct answer with detailed explanation and don't copy..

Which of the following statements about the tax wedge is true? Note: The tax wedge is the difference between the pre-tax and after-tax wage (or any return to economic activity) Causes a reduction of potential GDP and the long-run aggregate supply. O Causes more people to be employed because of higher wages. The tax-wedge is an example of demand side economics. Tax revenues increase with a greater tax wedge