Which of the Following Statements About the NOL Deduction Is

question 21

Multiple Choice

Which of the following statements about the NOL deduction is false?

• A) The deduction prevents the tax distortion that could result from an inflexible one-year reporting period.
• B) The deduction can reduce taxable income to zero in carryforward years.
• C) The deduction has value based on the NPV of its related tax savings.
• D) None of these choices are false.

---

Definitions:

Explicit Memory

A type of long-term memory that involves conscious recall of facts and events.

Betsy Ross

Traditionally credited with sewing the first American flag, she is a symbolic figure in American history.

American Flag

The national flag of the United States, consisting of thirteen horizontal stripes and fifty stars representing the states.

Effortful Processing

The active and conscious effort to encode or process information into the memory.