The Purpose of the Excise Tax Imposed on a Private

question 141

True/False

The purpose of the excise tax imposed on a private foundation for failure to distribute sufficient levels of income is to motivate the foundation to distribute more of its income for application to exempt purposes and thus be classified as a feeder organization.

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Definitions:

Panel

A group of people gathered to discuss, investigate, or make decisions about a specific subject or issue.

Restaurants

Establishments where food and drinks are prepared and served to customers.

Long Run

A period of time in which all factors of production and costs are variable, and firms can enter or exit the industry.

Market Entry

The process by which a new competitor enters an existing market to offer goods or services.