D. Suppose that the government imposes a tax on the oil refiner that makes the oil refiner pay twice per unit of output produced. is there T that induces the Pareto efficient level of o
Answer:
The answer is: D) raise the price, reduce the quantity, increase total revenues, and increase crime.
Explanation:
According to the law of supply and demand, when the supply of any given product is artificially lowered, the supply curve will shift:
- this will cause the price of that product to increase
- the profit margin of the suppliers will increase, increasing total revenue
- since illegal drugs would increase in crime, we can expect an increase in the crime rate on drug related crimes (e.g. addicts robbing).
Answer:
The amount Clydesdale should report as a deferred tax liability at December 31, 2017 is $214,840
Explanation:
The computation of the deferred tax liability is shown below:
= 2018 difference × Enacted tax rates + 2019 difference × Enacted tax rates + 2020 difference × Enacted tax rates
= $42,000 × 34% + $244,000 × 34% + $294,000 × 40%
= $14,280 + $82,960 + $117,600
= $214,840
We considered the difference of each year and its enacted tax rates. Th depreciation is not relevant. Hence, we ignored it
