What Happens Under Tax Equalization

question 21

Multiple Choice

What happens under tax equalization?

• A)Expatriates realize tax benefits whenever actual taxes are less than the hypothetical tax.
• B)The employee pays the foreign income tax,but not the U.S.government tax.
• C)Employers reimburse expatriates for the difference between the hypothetical tax and the actual income tax.
• D)The employer takes the responsibility for paying the income tax on behalf of the expatriates.

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Definitions:

Random Walk Theory

A financial theory suggesting that stock prices change randomly and are not influenced by past movements, making it impossible to predict future market directions consistently.

Stock Prices

The cost of purchasing a share of equity in a company at any given time on the stock market.

Real Rate Of Return

The profit or loss on an investment adjusted for inflation, representing the actual buying power of the earnings.

Experts

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