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145. Multiple Choice: Which of the following taxes reflects...
Question Which of the following taxes reflects the ability-to-pay principle?
146. Multiple Choice: Criteria that economists use in selec...
Question Criteria that economists use in selecting a tax system include:
147. Multiple Choice: The ________ principle implies that p...
Question The ________ principle implies that people with ________ should pay more taxes.
Answer ability-to-pay; greater benefits received
148. Multiple Choice: A principle suggesting that people wi...
Question A principle suggesting that people with more income or wealth should pay more
taxes is the:
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149. Multiple Choice: According to the benefits principle, ...
Question According to the benefits principle, which of the following is the best example of
taxation?
Answer income tax
150. Multiple Choice: Paying a fee every time you use the m...
Question Paying a fee every time you use the municipal golf course is an example of the:
regressive tax principle.
151. Multiple Choice: Taxation according to the ability-to-...
Question Taxation according to the ability-to-pay principle is best illustrated in the United
States by:
Answer sales taxes.
152. Multiple Choice: Since the terrorist attacks of Septem...
Question Since the terrorist attacks of September 11, 2001, the FAA has added a small
security fee to every airplane ticket purchased. This is an example of:
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153. Multiple Choice: According to the ________, those who ...
Question According to the ________, those who benefit from public spending should bear the
burden of the tax that pays for the spending.
Answer ability-to-pay principle
154. Multiple Choice: According to the ________, those with...
Question According to the ________, those with greater ability to pay a tax should pay more
tax.
affordability principle
155. Multiple Choice: Which of the following taxes best ill...
Question Which of the following taxes best illustrates the benefits principle of tax fairness?
Answer The local city playground is funded through a tax on all citizens.
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156. Multiple Choice: Which of the following taxes best ill...
Question Which of the following taxes best illustrates the ability-to-pay principle of tax
fairness?
Answer The local city playground is funded through a tax on all citizens.
157. Multiple Choice: A principle suggesting that people wi...
Question A principle suggesting that people with more income or wealth should pay more
taxes is the:
Answer ability-to-pay principle.
proportional tax principle.
lump-sum tax principle.
benefits received principle.
158. Multiple Choice: Taxation according to the ability-to-...
Question Taxation according to the ability-to-pay principle is best illustrated in the United
States by:
Answer sales taxes.
159. Multiple Choice: Taxation according to the benefits-re...
Question Taxation according to the benefits-received principle is best illustrated by:
Answer income tax.
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160. Multiple Choice: You have to pay a fee every time you ...
Question You have to pay a fee every time you use your community swimming pool. This is
an example of the:
Answer regressive tax principle.
ability-to-pay principle.
161. Multiple Choice: If tax efficiency is the only goal, a...
Question If tax efficiency is the only goal, a tax system should be designed to minimize its:
Answer burden.
162. Multiple Choice: A tax system achieves equity when:
Question A tax system achieves equity when:
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163. Multiple Choice: A tax system achieves efficiency when:
Question A tax system achieves efficiency when:
Answer the “right” people actually bear the burden of taxes.
164. Multiple Choice: If a tax system is poorly designed, i...
Question If a tax system is poorly designed, it may be possible to increase:
Answer efficiency without sacrificing equity.
165. Multiple Choice: Suppose Congress passed a new tax sys...
Question Suppose Congress passed a new tax system, such that all federal, state, and
local taxes were replaced with one tax: a tax of $14,000 for every person 18 and
over. This new tax system would clearly improve:
Answer tax equity.
166. Multiple Choice: A tax system ________ when it minimiz...
Question A tax system ________ when it minimizes the direct and indirect costs to the
economy of tax collection.
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167. Multiple Choice: A tax system ________ when the &ldquo...
Question A tax system ________ when the “right people actually bear the burden of taxes.”
Answer is efficient
168. Multiple Choice: If a tax system is designed to minimi...
Question If a tax system is designed to minimize the sum of its deadweight loss and its
administrative cost, then:
169. Multiple Choice: Which of the following does not disto...
Question Which of the following does not distort incentives and is best at promoting
economic efficiency?
170. Multiple Choice: If a tax system is well designed, it ...
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Question If a tax system is well designed, it must be true that:
Answer it maximizes efficiency.
171. Multiple Choice: Which of the following statements in ...
Question Which of the following statements in correct?
172. Multiple Choice: The richest 20% of families in the Un...
Question The richest 20% of families in the United States pay a much ________ share of
total income taxes collected and a ________ share of total payroll taxes than their
share of total income.
173. Multiple Choice: The poorest 20% of families in the Un...
Question The poorest 20% of families in the United States pay a ________ share of their
total income in taxes.
Answer very large
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174. Multiple Choice: Figure: Income Tax Payments Reference...
Question Figure: Income Tax Payments
Reference: Ref 7-14
(Figure: Income Tax Payments) Look at the figure Income Tax Payments. Which
panel or panels best represent the effects of a progressive income tax?
Answer A
175. Multiple Choice: Figure: Income Tax Payments Reference...
Question Figure: Income Tax Payments
Reference: Ref 7-14
(Figure: Income Tax Payments) Look at the figure Income Tax Payments. Which
panel or panels best represent the effects of a proportional income tax?
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176. Multiple Choice: Figure: Income Tax Payments Reference...
Question Figure: Income Tax Payments
Reference: Ref 7-14
(Figure: Income Tax Payments)Look at the figure Income Tax Payments. Which
panel or panels best represent the effects of a regressive income tax?
Answer A
177. Multiple Choice: Brianna and Jess must pay an income t...
Question Brianna and Jess must pay an income tax. Both Brianna and Jess pay $1,000 in
taxes each year, but Brianna earns $20,000 and Jess earns $10,000. From this
information, you can infer that the tax system is:
Answer progressive.
178. Multiple Choice: Suppose a government imposes an incom...
Question
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Suppose a government imposes an income tax that taxes 0% of the first $1,000,
10% of the next $10,000, and 20% of the remainder of earnings. This type of tax
can be described as:
equitable.
179. Multiple Choice: Suppose an income tax is levied on 0%...
Question Suppose an income tax is levied on 0% of the first $1,000, 10% of the next $9,000,
and 20% of the remainder of earnings. How much tax would Miranda have to pay if
she earned $20,000?
$3,000
180. Multiple Choice: A tax that takes a larger share of th...
Question A tax that takes a larger share of the income of high-income taxpayers than of low-
income taxpayers is called a:
Answer sales tax.
181. Multiple Choice: A tax that rises less than in proport...
Question A tax that rises less than in proportion to income is described as:
Answer progressive.
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182. Multiple Choice: A progressive tax:
Question A progressive tax:
183. Multiple Choice: Suppose Governor Meridias decides to ...
Question Suppose Governor Meridias decides to initiate a state-level income tax. The first
$50,000 of household income is tax-free, while any income above $50,000 is taxed
at 10%. A household earning $50,000 has a marginal tax rate of ________ and an
average tax rate of ________.
Answer 10%; 10%
184. Multiple Choice: Suppose Governor Meridias decides to ...
Question Suppose Governor Meridias decides to initiate a state-level income tax. The first
$50,000 of household income is tax-free, while any income above $50,000 is taxed
at 10%. The marginal tax rate for a household earning $75,000 is:
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185. Multiple Choice: If the government follows an income t...
Question If the government follows an income tax system in which personal income up to
and including $25,000 is not taxed, income of $25,001 to $50,000 is taxed at 10%,
and income over $50,000 is taxed at 25%, a family earning $60,000 of income will
pay ________ in personal taxes.
186. Multiple Choice: Paying a tax of $20 on an income of $...
Question Paying a tax of $20 on an income of $100, a tax of $15 on an income of $200, and
a tax of $12 on an income of $300 is an example of a:
Answer flat tax.
187. Multiple Choice: A tax that takes a fixed percentage o...
Question A tax that takes a fixed percentage of income, regardless of the level of income, is
a:
188. Multiple Choice: Paying a tax of $10 on an income of $...
Question
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Paying a tax of $10 on an income of $100, a tax of $20 on an income of $200, and
a tax of $30 on an income of $300 is an example of a:
Answer regressive tax.
189. Multiple Choice: A tax that takes a higher percentage ...
Question A tax that takes a higher percentage of income as income rises is:
Answer proportional.
190. Multiple Choice: Paying a tax of $10 on an income of $...
Question Paying a tax of $10 on an income of $100, a tax of $25 on an income of $200, and
a tax of $60 on an income of $300 is an example of a:
191. Multiple Choice: A tax that takes a ________ percentag...
Question A tax that takes a ________ percentage of income as income ________ is a
________ tax.
Answer lower; rises; progressive
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192. Multiple Choice: A progressive tax is one levied on:
Question A progressive tax is one levied on:
Answer a fixed percentage of income.
193. Multiple Choice: Taxes paid on the wages received from...
Question Taxes paid on the wages received from a job are called:
sales tax.
194. Multiple Choice: Annual taxes paid on the value of a h...
Question Annual taxes paid on the value of a home are called:
Answer income tax.
profits tax.
195. Multiple Choice: Taxes paid on the purchase of most co...
Question Taxes paid on the purchase of most consumption goods are called:
Answer income tax.
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196. Multiple Choice: The government imposes a tax of $1,00...
Question The government imposes a tax of $1,000 per household to fund a new public
swimming pool. This tax is an example of a:
flat tax.
197. Multiple Choice: Paying a tax of $15 on an income of $...
Question Paying a tax of $15 on an income of $200, a tax of $10 on an income of $300, and
a tax of $8 on an income of $400 is an example of a:
Answer constant-rate tax.
198. Multiple Choice: A tax that takes a _______ is ________.
Question A tax that takes a _______ is ________.
larger share of the income of high-income taxpayers than of low-income
taxpayers; regressive
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199. Multiple Choice: Paying a tax of $20 on an income of $...
Question Paying a tax of $20 on an income of $200, a tax of $40 on an income of $400, and
a tax of $50 on an income of $500 is an example of:
Answer a regressive tax.
200. Multiple Choice: A tax that takes a _______ percentage...
Question A tax that takes a _______ percentage of income as income rises is _______.
Answer higher; proportional
201. Multiple Choice: Paying a tax of $20 on an income of $...
Question Paying a tax of $20 on an income of $200, a tax of $40 on an income of $300, and
a tax of $80 on an income of $400 is an example of a:
constant-rate tax.
202. Multiple Choice: Which of the following best describes...
Question Which of the following best describes a regressive tax?
Answer A tax that takes a higher percentage of income as income rises.
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203. Multiple Choice: A regressive tax is one that takes a:
Question A regressive tax is one that takes a:
Answer fixed percentage of income.
204. Multiple Choice: In analyzing the impact of a progress...
Question In analyzing the impact of a progressive tax system, economists focus on the
________ tax rate.
Answer average
205. Multiple Choice: The percentage of an increase in a ta...
Question The percentage of an increase in a taxpayer's income that is taxed away is the:
lower tax rate.
206. Multiple Choice: If the marginal tax rate is greater t...
Question
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If the marginal tax rate is greater than the average tax rate, we know that the tax
system is:
Answer proportional.
207. Multiple Choice: If the marginal tax rate is less than...
Question If the marginal tax rate is less than the average tax rate, we know that the tax
system is:
Answer proportional.
208. Multiple Choice: If the marginal tax rate equals the a...
Question If the marginal tax rate equals the average tax rate, we know that the tax system
is:
regressive.
209. Multiple Choice: In 2008, the Social Security tax was ...
Question In 2008, the Social Security tax was levied on incomes only up to $102,000. Which
of the following statements about this tax is correct?
Answer A worker with an annual income of $50,000 and one with an annual income of
$100,000 would pay the same dollar amount of payroll tax.
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210. Multiple Choice: Income tax rates are such that Mr. R....
Question Income tax rates are such that Mr. R. Hood earns $35,000 per year and pays
$7,000 in taxes, while Mr. G. Gisbourne earns $1 million per year and pays
$200,000 in taxes. This tax is:
Answer progressive.
211. Multiple Choice: An efficient way to finance the provi...
Question An efficient way to finance the provision of city services (such as street cleaning)
would be to charge all city residents a lump-sum tax. Such a tax would be:
Answer progressive.
212. Multiple Choice: Suppose Governor Meridias initiates a...
Question Suppose Governor Meridias initiates a payroll tax of 10% on all income up to
$50,000. Any income above $50,000 is not taxed. This payroll tax will be:
Answer progressive.
proportional.
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