Which of the Following Statements Is True? the Burden of a Payroll

question 30

Multiple Choice

Which of the following statements is true? The burden of a payroll tax is paid:

• A) by workers if the demand for labour is perfectly inelastic.
• B) by firms if they are legally responsible for remitting the tax to the government.
• C) by both workers and firms if the elasticities of demand and supply of labour are between zero and infinity.
• D) by workers if the supply of labour is perfectly elastic.
• E) indeterminate.

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Definitions:

Futures Contract

A standardized agreement to buy or sell a specific asset at a predetermined price at a specified time in the future.

Clearinghouse

An intermediary agency that facilitates the clearing and settling of financial transactions, often associated with exchanges and securities.

Profit

The earnings resulting when business activity revenues exceed the necessary expenses, costs, and taxes to maintain the activity.

Long Oil Futures Contract

An agreement to buy oil at a specified price on a specified future date, bet taken with the expectation that oil prices will rise.