Shanghai Corporation Was Organized and Elected S Status in the Current

question 24

Multiple Choice

Shanghai Corporation was organized and elected S status in the current year. How much passive investment income can Shanghai earn and retain its S status?

• A)none
• B)80% of gross receipts
• C)50% of gross receipts
• D)no limit

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Definitions:

Pollution Abatement

Measures or actions taken to reduce, control, or eliminate pollution from various sources in order to protect the environment.

Marginal Benefit

The heightened enjoyment or usefulness one receives by using an additional unit of any good or service.

Law of Diminishing Returns

A principle stating that as one factor of production is increased while others are held constant, the resulting addition to output will eventually decrease.

Coase Theorem

An economic theory stating that if private parties can bargain without cost over the allocation of resources, they can solve the problem of externalities on their own.