The "underground economy" refers to a. the formal sector of the economy in developing countries. b. the sector of the economy that earns profits that are higher than average. c. the buying and selling of goods that is concealed from the government. d. the production of goods and services used by the government for covert spy operations.

The correct answer is the letter B. “the sector of the economy that earns profits that are higher than average”

Explanation:

The underground economy refers to the informal economy, that is, productive activities that are not declared to the government and therefore are not under taxation. Thus, the profits earned from these activities are higher than average, since they do not pay taxes.