An Advantage of Imposing a Tax on the Producer That

question 58

Multiple Choice

An advantage of imposing a tax on the producer that generates pollution is that

• A)it forces the polluting producer to internalize the external cost of the pollution.
• B)the government can keep tabs on exactly what is produced in an industry.
• C)it will eliminate pollution.
• D)a producer can pass the cost of the pollution to consumers.

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Definitions:

Consolidation Entry G

An adjusting entry made during the consolidation process to eliminate intra-group transactions and balances in the preparation of consolidated financial statements.

Intra-entity Gross Profit

Refers to the profit generated from transactions within the same company or group, not yet realized from an external party's perspective.

Consolidation Process

The method of combining the financial statements of two or more legally separate entities into one set of financial statements for the group as a whole.

Voting Common Stock

Refers to a class of shares that grants the holder the right to vote on company matters and board elections.