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Author Question: Business-related expenses of employees are higher than they otherwise would be due to most ... (Read 79 times)

RRMR

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on: Jul 1, 2018
Business-related expenses of employees are higher than they otherwise would be due to most business-related expenses being _____.
 
  a. frivolous
  b. accounted for at personal tax rates, not corporate tax rates
  c. a tax credit for the individual
   d. nontaxable fringe benefits

Question 2

One million automobiles have a defect that could cause the car to explode; however, only one of those cars will actually explode. Nobody knows which one car it is.
 
  When the car does explode, the victim's family will sue the automaker for 1 million and win. The defect costs 2 per car to repair. What does economics predict about the automaker's decision to repair the defect?


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k2629

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Reply #1 on: Jul 1, 2018
Answer to Question 1

d

Answer to Question 2

Correcting the defect will cost 2 million. Not correcting the defect will only cost 1 million. Economics predicts that the automaker will not correct the defect.


RRMR

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Reply 2 on: Jul 1, 2018
YES! Correct, THANKS for helping me on my review

kishoreddi

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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