Answer:
differing opinions on the point we are on the Laffer Curve
A
Explanation:
The Laffer Curve is a supply side economic theory developed by Arthur Laffer in 1974.
The curve depicts the relationship between tax rates and tax revenue
According to this theory, higher income tax rate reduces the incentive of labour to work and invest due to the fact that labour would have to pay higher tax. This means that at some point, increase in the tax rate would decrease government revenue rather than increase it.
The theory submits that there is an optimal tax rate at which tax income is maximised. Once this point is surpassed, increase in tax rate would reduce government revenue
Price ceiling is when the government or an agency of the government sets the maximum price for a product. It is binding when it is set below equilibrium price.
Effects of a binding price ceiling
1. It leads to shortages
2. it leads to the development of black markets
3. it prevents producers from raising price beyond a certain price
4. It lowers the price consumers pay for a product. This increases consumer surplus
A rent ceiling would lead to shortage of houses and a reduction of the quality of available housing.
Answer:
b.(1/2, 1/2)
Explanation:
If one vendor is located at “1/2” then the best possible respond of the other vendor is “1/2”, both of them of capture the equal share of the market.
Therefore, Nash equilibrium is (1/2 , 1/2).
Answer: $42000
Explanation:
Saginaw's foreign tax credit on its 2018 tax return will be calculated thus:
= Foreign source taxable income × precredit U.S tax/Taxable income
= 200000 × 105000/500000
= 200000 × 0.21
= 42000
Therefore, the foreign tax credit will be the least between $60,000 paid to the German government or $42000. In this case, the answer is $42000
Answer:
Dec 31 2016 Interest expense 2640 Dr
Interest payable 2640 Cr
Explanation:
the adjusting entry is made at the end of the period which is 31 December 2016 here. The notes pays interest at 8% per annum. So, the total interest due for one year on note payable is,
Interest = 44000 * 0.08 = 3520
Out of this amount of interest payable, 9 month's interest related to period from April to December. So, at 31 December, we will recognie 9 month's interest as interest expense 3520 * 9/12 = 2640. And debit interest expense account by this figure. As the interest is not paid today, we will credit interest payable.
