Exam 17: Public Choice, Taxes, and the Distribution of Income

Prior to the passage of the Tax Cuts and Jobs Act of 2017, the owners of sole proprietorships would pay ________ on their profits.

From 1990 to 2015, the poverty rate in East Asia rose slightly but the level of poverty in sub-Saharan Africa fell dramatically.

According to projections for 2019 by the Tax Policy Center, the 20 percent of U.S. taxpayers who make the highest incomes

Suppose $1 billion is available in the budget and Congress is considering allocating the funds to one of the following three alternatives: 1) Subsidies for education, 2) Research on Alzheimer's or 3) Increased border security. Table 17-1 shows three voters' rankings of the alternatives. -Refer to Table 17-1. Suppose a series of votes are taken in which each pair of alternatives is considered in turn. If the vote is between allocating funds to research on Alzheimer's and increased border security

Absolute poverty measures vary from country to country. For example, in 2019, the poverty line in the United States for a family of four was an annual income of $25,750 but economists often use a much lower threshold income of $3.20 per day when calculating the rate of poverty in poor countries. Using this $3.20-per-day threshold, which of the following regions had the smallest percentage decrease in the percentage of the population in poverty from 1990 to 2015?

When Congress and President Trump enacted the Tax Cuts and Jobs Act of 2017, they

-Refer to Table 17-12. a. Draw a Lorenz curve for each country. b. Which country has the more equal distribution of income? c. Based on the Lorenz curves for the two countries, can you determine which country has the more progressive tax system? Explain your answer.

-Refer to Figure 17-4. Rank the above panels in terms of most unequal income distribution to least unequal income distribution.

-Refer to Figure 17-1. Area B + C + F + G represents

-Refer to Figure 17-1. The sales tax revenue collected by the government is represented by the area

-Refer to Table 17-9. Sylvia is a single taxpayer with an income of $70,000. What is her marginal tax rate and what is her average tax rate?

Between 1990 and 2015, the poverty rate in East Asia declined dramatically while the poverty rate in sub-Saharan Africa has seen much less of a decline. The main reason for this is that

A CBO study estimated that the excess burden from the corporate income tax ________ of the revenues raised by the tax. This estimate would make the corporate income tax ________ imposed by the federal government.

The Gini coefficient for the United States in 1980 was 0.403. In 2018, the coefficient was equal to 0.486. This means that

-Refer to Table 17-7. The tax system is

State tax revenue from marijuana sales in Colorado have surpassed $1 billion since its legalization in 2014. Total sales from licensed retailers in Colorado have exceeded $6.5 billion since the state became the first to legalize recreational marijuana. Retail customers pay a 2.9% standard sales tax and a 15% state marijuana sales tax, on top of local taxes. In addition to paying for industry regulation and enforcement, state revenue is used used to fund several state initiatives, including a public school construction fund, youth drug use prevention, and affordable housing. Source: Claire Hansen, "State Revenue from Pot Tops $1 Billion in Colorado," usnews.com, June 13, 2019. -Refer to the Article Summary. Refer to the Article Summary. Colorado taxes marijuana with a 2.9% standard sales tax and a 15% state marijuana sales tax, in addition to local taxes. Assume local taxes total 7.1%, so the total tax is 25% based on the initial selling price. Suppose the actual burden of the tax falls 70 percent on consumers and 30 percent on producers. In this case, consumers will actually bear the tax burden of ________ percent of the selling price and producers will actually bear the tax burden of ________ percent of the selling price.

Figure 17-2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 17-2. If the government imposes an excise tax of $1.00 on every unit sold, the consumer's burden of the tax

Of the following sources of tax revenue for state and local governments, which was the smallest in 2018?

Figure 17-2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 17-2. If the government imposes an excise tax of $1.00 on every unit sold, the producer's burden of the tax

Figure 17-7 shows the Lorenz curve for a hypothetical country. -Refer to Figure 17-7. The second lowest 20 percent of households