Which of the following statements is true?
A) Customers in high tax brackets would be more likely to take cash discounts and corporations in high tax brackets would be more likely to offer credit.
B) Customers in high tax brackets would be more likely to take cash discounts and corporations in low tax brackets would be more likely to offer credit.
C) Customers in low tax brackets would be more likely to take cash discounts and corporations in high tax brackets would be more likely to offer credit.
D) Customers in low tax brackets would be more likely to take cash discounts and corporations in low tax brackets would be more likely to offer credit.
E) Taxes have an effect on the propensity to grant credit, but no effect on the propensity to use credit.

Question

Quizplus · Accepted Answer

Customers in high tax brackets would be more likely to take cash discounts because they would save more money on taxes by doing so. Corporations in high tax brackets would be more likely to offer credit because they would be able to deduct the interest expense from their taxes.

Which of the Following Statements Is True