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

-Refer to Figure 17-3. The figure above shows a demand curve and two supply curves, one more elastic than the other. Use Figure 17-3 to answer the following questions. a. Suppose the government imposes an excise tax of $1.00 on every unit sold. Use the graph to illustrate the impact of this tax when the supply curve is S1 and when the supply curve is S2. b. If the government imposes an excise tax of $1.00 on every unit sold, will the consumer pay more of the tax if the supply curve is S1 or S2? Refer to the graphs in your answer. c. If an excise tax of $1.00 on every unit sold is imposed, will the revenue collected by the government be greater if the supply curve is S1 or S2? d. If the government imposes an excise tax of $1.00 on every unit sold, will the deadweight loss be greater if the supply curve is S1 or S2?

Which of the following groups had the highest poverty rate in 2018 in the United States?

Figure 17-5 shows the Lorenz curve for a hypothetical country. -Refer to Figure 17-5. The highest 20 percent of households

-Refer to Table 17-11. 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.

Figure 17-6 shows the Lorenz curves for Islandia and Syldavia. -Refer to Figure 17-6. Which country has the more unequal distribution of income?

-Refer to Table 17-6. How much income tax does Sasha pay if she is a single taxpayer with an income of $60,000?

If you pay $2,000 in taxes on an income of $20,000, and a tax of $3,500 on an income of $30,000, then over this range of income the tax is

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 education subsidies and increased border security

Figure 17-6 shows the Lorenz curves for Islandia and Syldavia. -Refer to Figure 17-6. If area X = 2,060, area Y = 240, and area Z = 2,700, calculate the Gini coefficient for Islandia.

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 government's revenue from the tax

-Refer to Table 17-9. How much income tax does Sylvia pay if she is a single taxpayer with an income of $70,000?

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 subsidies for education and research on Alzheimer's

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 largest percentage decrease in the percentage of the population in poverty from 1990 to 2015?

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

According to research by Jon Bakija, Adam Cole, and Bradley T. Heim, the occupation that makes up the largest group of the top 1 percent of income distribution in the United States 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. Colorado taxes marijuana with a 2.9% standard sales tax and a 15% state marijuana sales tax, in addition to local taxes. All of these taxes are paid by consumers at the time of purchase. Does this necessarily mean that consumers bear 100 percent of the burden of these taxes?

-Refer to Figure 17-1. Of the tax revenue collected by the government, the portion borne by producers is represented by the area

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

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

-Refer to Table 17-8. The tax system is