Taxes on Polluting Firms for Pollution Are Intended to

question 110

Multiple Choice

Taxes on polluting firms for pollution are intended to

• A)raise enough revenue to cut the deficit in half.
• B)encourage firms to reduce charges by polluting less.
• C)be efficient, i.e., result in no excess burden.
• D)raise revenue for general spending needs.

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Definitions:

Decreases

A reduction in the quantity, level, or intensity of something, such as expenses, assets, or liabilities.

Prepaid Insurance

An asset account that represents insurance payments made in advance for coverage extending beyond the current accounting period.

Accounts Payable

Amounts owed by a business to its suppliers shown as a liability on a company’s balance sheet and typically due within a short period of time, often 30 to 90 days.

Equipment

Tangible assets used in the operations of a business, not intended for sale, and depreciated over time.