Horizontal Equity in Taxation Refers to the Idea That People

question 545

Multiple Choice

Horizontal equity in taxation refers to the idea that people

• A)in unequal conditions should be treated differently.
• B)in equal conditions should pay equal taxes.
• C)should be taxed according to their ability to pay.
• D)should receive government benefits according to how much they have been taxed.

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Definitions:

Discount

A reduction applied to the normal selling price of goods or services, typically for the purpose of enticing customers or accelerating sales.

Journal Entry

A record in accounting that represents a transaction or adjustment affecting at least two accounts, which is necessary to keep the financial statements accurate.

Effective-Interest Method

An accounting technique used to amortize the discount or premium on bonds payable or receivable over the life of the bond, reflecting the bond's yield.