13. If corporations maximize profits, the short-run incidence of a tax on its profits will be borne by a. consumers. b. all investors. c. corporate shareholders d. workers. 14. According to the Harberger model of the incidence of the corporate income tax, the tax a. reduces the return to capital in the corporate sector of the economy only b. reduces the return to capital in all uses c. has no effect on the return to capital. d. increases the return to capital. 15. The double taxation of dividends under U.S. tax code means: a. dividends are taxed while not being adjusted for inflation b. dividends are paid from after tax corporate income and then taxed again as personal income. c. dividends are deducted as an expense at the corporate level, but as a gain at the personal level d. both (a) and (b) 16. The effective tax rate is: a. the same as the statutory tax rate. b. based on real economic profits. c. based on the nominal profits d. not inflation adjusted TRUE AND FALSE 17. Under a comprehensive income tax, transfer payments received by Social Secitcipents woald be fully taxable. 18. A comprehensive income tax will result in a divergence between gross wages paid by employers and net wages received by workers 19. If an individual is subject to a 30-percent income tax, then the net interest on a certificate of deposit yielding 5 percent would be 3.5 percent after taxes. 20. The substitution effect of a tax-induced decline in wages always leads workers to work less. In general, the shorter the depreciation period allowed for tax purposes, the higher the tax burden on corporations. 21. iation allows a firm to deduct more than the actual economic depreciation from 22. Accelerated depreci its income each year. 23. Inflation causes an understatement of true depreciation cost