Which of the Following Statements Is Correct

question 127

Multiple Choice

Which of the following statements is correct?

• A)Taxes are more difficult to administer than regulations.
• B)Taxes provide incentives for firms to adopt new methods to reduce negative externalities.
• C)Command-and-control policies provide incentives for private decisionmakers to solve their problems on their own.
• D)Corrective taxes distort incentives.

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Definitions:

Semiannual Interest Payment

A finance term referring to the practice of making interest payments twice a year on a loan or bond.

Bonds

Debt instruments signifying an investment made by an investor in the form of a loan to either a corporation or a government entity.

Journal Entries

Records of financial transactions in the books of accounts, acting as the primary source for all accounting processes.

Available-for-Sale Securities

Financial assets that are not classified as held-to-maturity or trading securities, and can be sold in the short-term.