A Situation in Which the Government Cannot Implement an Optimal

question 22

Multiple Choice

A situation in which the government cannot implement an optimal tax policy because the policy is inconsistent with the government's incentives over time is known as

• A)government tax problem.
• B)Arrow's impossibility theorem.
• C)the double dividend effect.
• D)time inconsistency of optimal policy.

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Definitions:

Foreign Corporation

A business entity that is registered and operates in a jurisdiction or country different from where it was originally incorporated.

Incorporated

The process by which a business is legally declared a corporate entity, separate from its owners.

Piercing The Veil

A legal concept that allows courts to hold shareholders or members of a corporation personally liable for the corporation's actions or debts under certain circumstances.

Nonprofit Corporation

An organization established for purposes other than making a profit, which typically benefits the public, a specific group of individuals, or the membership of the nonprofit.