Milton and Rocco Are Having a Heated Debate Regarding a National

question 93

Essay

Milton and Rocco are having a heated debate regarding a national sales tax. Milton argues that a national sales tax is a proportional, vertically equitable tax. Rocco argues that a national sales tax would be a regressive, vertically inequitable tax. Explain both sides of the argument.

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Definitions:

Watered Stock

Shares of a company that are issued at a value much greater than the assets of the company, leading to an inflation of the company's value on paper.

Fair Market Value

The price at which property would sell for on the open market between a willing buyer and a willing seller, both having reasonable knowledge of all relevant facts.

Corporate Opportunity

A business opportunity that a company must offer to its shareholders or members before taking it for personal gain.

Duty of Disclosure

The legal obligation to reveal all material facts or information relevant to a transaction or decision-making process.