Which of the Following Is True of Revenue Rulings

question 2

Multiple Choice

Which of the following is true of revenue rulings?

• A)Although they represent the official policy of the IRS, courts may overrule them.
• B)Lower courts are bound by them.
• C)They are a subset of Treasury Regulations.
• D)Once affirmed by an appellate court, they have the force of law.
• E)All of the above are true.

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Definitions:

Industry Equilibrium Price

The price at which the total quantity demanded by consumers equals the total quantity supplied by firms in an industry.

Perfectly Elastic

A situation in demand or supply where quantity demanded or supplied changes infinitely with any change in price.

Marginal Revenue

The additional income received from selling one more unit of a good or service. It is an important concept in microeconomics and business when determining the optimal level of sales and production.

Profit-Maximizing Level

The point at which a firm achieves the highest profit possible, where marginal cost equals marginal revenue.