Firm A has $100 profit, Firm B has $100 loss. If corporate tax rate is 50%,...
Firm A has $100 profit, Firm B has $100 loss. If corporate tax rate is 50%, how much tax does the merged firm pay?
Homework Answers
Q- Firm A has $100 profit, Firm B has $100 loss. If corporate tax rate is 50%, how much tax does the merged firm pay?
Ans: If both the firm A& B merged, then profit becomes zero. So, newly merged company nothing has to pay as no corporate tax.
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