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Direction: Give the meaning of the Foreign phrase given below.
Ad valorem
- a)according to the-value
- b)according to utility
- c)according to cost
- d)according to demand
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Direction:Give the meaning of the Foreign phrase given below.Ad valore...
Understanding "Ad Valorem"
The term "Ad valorem" originates from Latin and translates to "according to value." It is primarily used in taxation and commerce to signify that the amount of tax or duty is based on the assessed value of an item rather than its quantity or weight.
Key Points About Ad Valorem:
- Taxation Context:
- Ad valorem taxes are levied based on the value of the property, goods, or services.
- This is common in property taxes, sales taxes, and tariffs.
- Application in Commerce:
- Businesses apply ad valorem pricing to ensure that charges reflect the perceived value of goods or services.
- For instance, higher-value items may incur higher taxes or fees.
Why "B" is Incorrect
While option "B" states "according to utility," it misinterprets the concept of ad valorem. Utility refers to the usefulness or satisfaction derived from a good, which is a different concept from value assessment.
Conclusion
Thus, the correct understanding of "ad valorem" is "according to value," making option "A" the right choice in this context. It highlights the fundamental principle that the financial implications depend on the estimated worth, which is crucial for taxation and trade practices. The focus remains on value assessment rather than utility or demand metrics.
The term "Ad valorem" originates from Latin and translates to "according to value." It is primarily used in taxation and commerce to signify that the amount of tax or duty is based on the assessed value of an item rather than its quantity or weight.
Key Points About Ad Valorem:
- Taxation Context:
- Ad valorem taxes are levied based on the value of the property, goods, or services.
- This is common in property taxes, sales taxes, and tariffs.
- Application in Commerce:
- Businesses apply ad valorem pricing to ensure that charges reflect the perceived value of goods or services.
- For instance, higher-value items may incur higher taxes or fees.
Why "B" is Incorrect
While option "B" states "according to utility," it misinterprets the concept of ad valorem. Utility refers to the usefulness or satisfaction derived from a good, which is a different concept from value assessment.
Conclusion
Thus, the correct understanding of "ad valorem" is "according to value," making option "A" the right choice in this context. It highlights the fundamental principle that the financial implications depend on the estimated worth, which is crucial for taxation and trade practices. The focus remains on value assessment rather than utility or demand metrics.
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Question Description
Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer? for CLAT 2025 is part of CLAT preparation. The Question and answers have been prepared according to the CLAT exam syllabus. Information about Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for CLAT 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer?.
Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer? for CLAT 2025 is part of CLAT preparation. The Question and answers have been prepared according to the CLAT exam syllabus. Information about Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for CLAT 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Direction:Give the meaning of the Foreign phrase given below.Ad valorema)according to the-valueb)according to utilityc)according to costd)according to demandCorrect answer is option 'B'. Can you explain this answer?.
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