Once the Explicit Rules and Implicit Understandings That Govern All

question 21

Multiple Choice

Once the explicit rules and implicit understandings that govern all the transactions of a firm are in place, there must be:

• A)a system of controls that rewards appropriate behaviour and punishes inappropriate behaviour.
• B)a discussion on the necessity of following ethical practices in business.
• C)weekly reminder seminars to enforce guidelines.
• D)commitment from customers to accept these rules.
• E)cooperation from competitors to avoid conflicting outcomes.

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Definitions:

Marginal Tax Rate

The percentage of tax applied to your next dollar of income, indicating the rate at which your last dollar earned is taxed.

Local Property Tax

Local Property Tax is a levy on the value of a property, typically imposed by local government authorities to fund public services.

Payroll Tax

Taxes imposed on employers and employees, typically calculated as a percentage of the salaries that employers pay their staff.

Average Tax Rate

The proportion of total income that is paid in taxes, calculated by dividing the total amount of taxes paid by the total income.