The Table Given Below Shows the Absolute Tax Amounts Under

question 59

Multiple Choice

The table given below shows the absolute tax amounts under five different tax policies for respective income levels.Table 19.2

-Which of the following tax structures creates a disincentive to earn more?

• A)Proportional tax structure
• B)Regressive tax structure
• C)Digressive tax structure
• D)Progressive tax structure
• E)A combination of proportional and regressive tax structure

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Definitions:

Forward Contract

A financial derivative that represents a customized agreement to buy or sell an asset at a predetermined future date and price.

Spot Rate

The current market price for exchanging one currency for another for immediate delivery.

Balance Sheet Presentation

The method by which a company's financial position is detailed in its balance sheet, listing assets, liabilities, and equity.

Bonds

Fixed income investments representing loans made by an investor to a borrower, typically corporate or governmental.