Consider a Good to Which a Per-Unit Tax Applies

question 45

Multiple Choice

Consider a good to which a per-unit tax applies.The greater the price elasticities of demand and supply for the good,the

• A)smaller the deadweight loss from the tax.
• B)greater the deadweight loss from the tax.
• C)more efficient is the tax.
• D)more equitable is the distribution of the tax burden between buyers and sellers.

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Definitions:

Owner's Capital

The amount of equity a business owner has in the firm, representing the owner's personal investment plus any profits retained in the business.

Internal Control

Practices and procedures deployed by a company to verify the honesty of its financial and accounting figures, enhance responsibility, and eliminate swindling.

Inventoriable Costs

Direct costs associated with the acquisition or production of goods that are held for sale in the ordinary course of business.

Closing Entries

Closing entries are journaled at the end of an accounting period to transfer the balances in temporary accounts to permanent accounts, thereby resetting the temporary accounts for the next period.