According to the Text, How Does Tax Avoidance Differ from Tax

question 27

Multiple Choice

According to the text, how does tax avoidance differ from tax evasion?

• A) Tax avoidance makes a company more competitive; tax avoidance damages a company's profitability.
• B) Tax avoidance is always ethical; tax evasion is never ethical.
• C) Tax avoidance occurs domestically; tax evasion involves foreign entities.
• D) Tax avoidance is legal; tax evasion is illegal.

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Definitions:

Price

The sum of money anticipated, needed, or provided as payment for an item.

Demand Curve

A graphical representation that shows the relationship between the price of a product and the quantity of the product demanded.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, signifying the relative change in demand due to price changes.

Price Elasticity

The degree to which demand for a particular item changes in response to price adjustments.