Question 1

Table 12-19 
-Refer to Table 12-19. The tax system is

Accepted Answer

A)  progressive.
B)  regressive.
C)  proportional.
D)  lump sum.E) B) and C)
F) None of the above

Question 2

As a person's or family's income rises, the marginal federal income tax rate __________.

Accepted Answer

The answer of As a person's or family's income rises,...

Question 3

Scenario 12-2
Suppose that Bob places a value of $10 on a movie ticket and that Lisa places a value of $7 on a movie ticket. In addition, suppose the price of a movie ticket is $5.
-Refer to Scenario 12-2. Suppose the government levies a tax of $1 on each movie ticket and that, as a result, the price of a movie ticket increases to $6.00. If Bob and Lisa both purchase a movie ticket, what is total consumer surplus for Bob and Lisa?

Accepted Answer

A)  $0.00
B)  $0.50
C)  $5.00
D)  $6.00E) A) and B)
F) B) and D)

Question 4

Table 12-16 
-Refer to Table 12-16. In this tax system which of the following is possible?

Accepted Answer

A)  vertical and horizontal equity
B)  vertical but not horizontal equity
C)  horizontal but not vertical equity
D)  neither horizontal nor vertical equityE) A) and C)
F) B) and D)

Question 5

The flypaper theory of tax incidence

Accepted Answer

A)  ignores the indirect effects of taxes.
B)  assumes that most taxes should be "stuck on " the rich.
C)  says that once a tax has been imposed, there is little chance of it changing, so in essence people are stuck with it.
D)  suggests that taxes are like flies because they are everywhere and will never go away.E) A) and B)
F) A) and C)

Question 6

In which of the following tax systems do taxes increase as income increases?

Accepted Answer

A)  both proportional and progressive
B)  proportional but not progressive
C)  progressive but not proportional
D)  neither proportional nor progressiveE) B) and C)
F) C) and D)

Question 7

Tax incidence refers to

Accepted Answer

A)  what product or service the tax is levied on.
B)  who bears the tax burden.
C)  what sector of the economy is most affected by the tax.
D)  the dollar value of the tax revenues.E) All of the above
F) A) and D)

Question 8

The marginal tax rate serves as a measure of the extent to which the tax system discourages people from working.

Accepted Answer

A) True 
 B)False

Question 9

The federal taxes owed by a taxpayer depend

Accepted Answer

A)  only upon the marginal tax rate on the taxpayer's first $25,000 of income.
B)  only upon the marginal tax rate on the taxpayer's last $10,000 of income.
C)  upon all the marginal tax rates up to the taxpayer's overall level of income.
D)  upon all the marginal tax rates, including those for income levels that exceed the taxpayer's overall level of income.E) B) and C)
F) A) and D)

Question 10

What is the current, annual, approximate amount per person paid to the federal government in individual income taxes, social insurance taxes, corporate income taxes, and other taxes?

Accepted Answer

a little m...

Question 11

The income tax requires that taxpayers pay 10percent on the first $40,000 of income and 20 percent on all income over $40,000. Emily paid $9,000 in taxes. What were her marginal and average tax rates?

Accepted Answer

A)  20 percent and 13.8 percent, respectively
B)  20 percent and 15 percent, respectively
C)  10 percent and 13.8 percent respectively
D)  10 percent and 15 percent respectivelyE) C) and D)
F) A) and B)

Question 12

A lump-sum tax would take different amounts from the poor and the rich.

Accepted Answer

A) True 
 B)False

Question 13

For state and local governments, in 2011, sales taxes and property taxes made up approximately

Accepted Answer

A)  10 percent of all receipts.
B)  22 percent of all receipts.
C)  33 percent of all receipts.
D)  43 percent of all receipts.E) B) and C)
F) C) and D)

Question 14

Table 12-14 
-Refer to Table 12-14. The tax system is

Accepted Answer

A)  progressive.
B)  regressive.
C)  proportional.
D)  lump sum.E) C) and D)
F) All of the above

Question 15

Rank the following state and local government expenditure categories from smallest to largest.

Accepted Answer

A)  education, health, highways
B)  education, highways, health
C)  highways, health, education
D)  health, education, highways.E) None of the above
F) A) and C)

Question 16

The two types of taxes that are most important to state and local governments as sources of revenue are

Accepted Answer

A)  individual income taxes and corporate income taxes.
B)  sales taxes and individual income taxes.
C)  sales taxes and property taxes.
D)  social insurance taxes and property taxes.E) C) and D)
F) B) and D)

Question 17

Table 12-12 
-Refer to Table 12-12. If the government imposes a $3,000 lump-sum tax, the marginal tax rate for Charles would be

Accepted Answer

A)  0 percent.
B)  5 percent.
C)  6.7 percent.
D)  10 percent.E) A) and B)
F) A) and C)

Question 18

Social Security is an income support program, designed primarily to maintain the living standards of the poor.

Accepted Answer

A) True 
 B)False

Question 19

Give an example of a tax system where the marginal tax rate would equal the average tax rate.

Accepted Answer

The marginal tax rate would equal the av...

Question 20

When the government levies a tax on a corporation,

Accepted Answer

A)  all the burden of the tax ultimately falls on the corporation's owners.
B)  the corporation is more like a tax collector than a taxpayer.
C)  output must increase to compensate for reduced profits.
D)  less deadweight loss will occur since corporations are entities and not people who respond to incentives.E) A) and B)
F) A) and C)

Exam 12: The Design of the Tax System

The income tax requires that taxpayers pay 10percent on the first $40,000 of income and 20 percent on all income over $40,000. Emily paid $9,000 in taxes. What were her marginal and average tax rates?

Correct Answer
verified

Give an example of a tax system where the marginal tax rate would equal the average tax rate.

Correct Answer
verified
The marginal tax rate would equal the av...
View Answer

What is the current, annual, approximate amount per person paid to the federal government in individual income taxes, social insurance taxes, corporate income taxes, and other taxes?

Correct Answer
verified
a little m...
View Answer

Table 12-12 -Refer to Table 12-12. If the government imposes a $3,000 lump-sum tax, the marginal tax rate for Charles would be

Correct Answer
verified

The two types of taxes that are most important to state and local governments as sources of revenue are

Correct Answer
verified

The federal taxes owed by a taxpayer depend

Correct Answer
verified

The marginal tax rate serves as a measure of the extent to which the tax system discourages people from working.

Correct Answer
verified

Rank the following state and local government expenditure categories from smallest to largest.

Correct Answer
verified

Table 12-16 -Refer to Table 12-16. In this tax system which of the following is possible?

Correct Answer
verified

When the government levies a tax on a corporation,

Correct Answer
verified

The flypaper theory of tax incidence

Correct Answer
verified

Table 12-14 -Refer to Table 12-14. The tax system is

Correct Answer
verified

Table 12-19 -Refer to Table 12-19. The tax system is

Correct Answer
verified

Correct Answer
verified

Tax incidence refers to

Correct Answer
verified

Social Security is an income support program, designed primarily to maintain the living standards of the poor.

Correct Answer
verified

In which of the following tax systems do taxes increase as income increases?

Correct Answer
verified

As a person's or family's income rises, the marginal federal income tax rate __________.

Correct Answer
verified

For state and local governments, in 2011, sales taxes and property taxes made up approximately

Correct Answer
verified

A lump-sum tax would take different amounts from the poor and the rich.

Correct Answer
verified

Exam 12: The Design of the Tax System

The income tax requires that taxpayers pay 10percent on the first $40,000 of income and 20 percent on all income over $40,000. Emily paid $9,000 in taxes. What were her marginal and average tax rates?

Correct AnswerverifiedShow Answer

Give an example of a tax system where the marginal tax rate would equal the average tax rate.

Correct AnswerverifiedThe marginal tax rate would equal the av...View AnswerShow Answer

What is the current, annual, approximate amount per person paid to the federal government in individual income taxes, social insurance taxes, corporate income taxes, and other taxes?

Correct Answerverifieda little m...View AnswerShow Answer

Table 12-12 -Refer to Table 12-12. If the government imposes a $3,000 lump-sum tax, the marginal tax rate for Charles would be

Correct AnswerverifiedShow Answer

The two types of taxes that are most important to state and local governments as sources of revenue are

Correct AnswerverifiedShow Answer

The federal taxes owed by a taxpayer depend

Correct AnswerverifiedShow Answer

The marginal tax rate serves as a measure of the extent to which the tax system discourages people from working.

Correct AnswerverifiedShow Answer

Rank the following state and local government expenditure categories from smallest to largest.

Correct AnswerverifiedShow Answer

Table 12-16 -Refer to Table 12-16. In this tax system which of the following is possible?

Correct AnswerverifiedShow Answer

When the government levies a tax on a corporation,

Correct AnswerverifiedShow Answer

The flypaper theory of tax incidence

Correct AnswerverifiedShow Answer

Table 12-14 -Refer to Table 12-14. The tax system is

Correct AnswerverifiedShow Answer

Table 12-19 -Refer to Table 12-19. The tax system is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Tax incidence refers to

Correct AnswerverifiedShow Answer

Social Security is an income support program, designed primarily to maintain the living standards of the poor.

Correct AnswerverifiedShow Answer

In which of the following tax systems do taxes increase as income increases?

Correct AnswerverifiedShow Answer

As a person's or family's income rises, the marginal federal income tax rate __________.

Correct AnswerverifiedShow Answer

For state and local governments, in 2011, sales taxes and property taxes made up approximately

Correct AnswerverifiedShow Answer

A lump-sum tax would take different amounts from the poor and the rich.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
The marginal tax rate would equal the av...
View Answer

Correct Answer
verified
a little m...
View Answer

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