The Graph Shown Demonstrates a Tax on Buyers

question 125

Multiple Choice

The graph shown demonstrates a tax on buyers. Before the tax was imposed, buyers purchased _______ units and paid _______ for each one.

• A) 6; $22
• B) 6; $34
• C) 9; $18
• D) 9; $30

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Definitions:

Plant Assets

These are long-term tangible assets used in the operations of a business that are not intended for resale, such as machinery, buildings, and land.

Fair Market Value

The price that a willing buyer and a willing seller would agree on for an asset in an open and competitive market.

Book Value

Book Value is the net value of a company's assets minus its liabilities, as recorded on the balance sheet.

Memorandum Entry

An accounting entry that is made in the records but does not affect the financial statements.