A Tax Burden Falls More Heavily on the Side of the Market

question 202

True/False

A tax burden falls more heavily on the side of the market that is less elastic.

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Definitions:

Outstanding Shares

The total number of shares of a corporation that have been issued and are held by shareholders, excluding treasury shares.

Contributed Surplus

An account on a company's balance sheet representing the excess amount investors pay over the par value of the company's shares.

Preferred Shares

A class of ownership in a corporation that has a higher claim on assets and earnings than common shares, often with fixed dividends.

Common Shares

Equity securities that represent ownership in a company, entitling holders to vote at shareholder meetings and to receive a share of the company's profits through dividends.