Gen Combo Managerial Economics & Business Strategy; Connect Access Card
9th Edition
ISBN: 9781260044294
Author: Baye
Publisher: MCG
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Chapter 4, Problem 18PAA
To determine
To find:
Whether an average 15-year old be indifferent between receiving a $50 gift certificate for iTunes and $50 in cash.
Introduction:
If two goods provide a similar amount of utility and satisfaction to a consumer at a point of time, the consumer can be indifferent in deciding to choose the product. This combination is shown through a graph called an indifference curve.
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Discuss the preferred deterrent method employed by the Zambian government to combat tax evasion, monetary fines. As noted in the reading the potential penalty for corporate tax evasion is a fine of 52.5% of the amount evaded plus interest assessed at 5% annually along with a possibility of jail time. In general, monetary fines as a deterrent are preferred to blacklisting of company directors, revoking business operation licenses, or calling for prison sentences. Do you agree with this preference? Should companies that are guilty of tax evasion face something more severe than a monetary fine? Something less severe? Should the fine and interest amount be set at a different rate? If so at why? Provide support and rationale for your responses.
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