Which of the Following Is a Problem with Positive Accounting

question 2

Multiple Choice

Which of the following is a problem with Positive Accounting Theory?

• A) It is not testable.
• B) It has been empirically discredited.
• C) It contributes little to improving accounting practice.
• D) None of the given options are correct.

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Definitions:

Individual Income

The total amount of money earned by a person from all sources before taxes.

Tax Competition

It refers to the phenomenon where countries or jurisdictions compete against each other to attract business through lower tax rates or more favorable tax regimes.

Federal Taxes

Federal taxes are financial charges imposed by a government on individuals, corporations, and other entities' income, property, or transactions to fund public services and obligations.

Regressive

A term referring to a tax system where the tax rate decreases as the amount subject to taxation increases, often disproportionately affecting lower-income individuals.