The Ability-To-Pay Principle Says That

question 73

Multiple Choice

The ability-to-pay principle says that:

• A)the amount of tax paid depends on the measure of value.
• B)those who benefit from public spending should bear the burden of the tax that pays for that spending.
• C)those with greater ability to pay should pay more tax.
• D)those who benefit from the tax should pay the same percentage of the tax base as those who do not benefit.

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Definitions:

Building

A structure used or intended for supporting or sheltering any use or continuous occupancy.

Income Statement

A financial document that provides a summary of a company's revenues, expenses, and profits over a specified period, typically a quarter or year.

Gross Margin

The difference between revenue and the cost of goods sold, indicating the profitability of selling goods.

Direct Expenses

Costs that can be directly attributed to the production of goods or services, such as raw materials and direct labor.