Question 1

Who said,"In this world nothing is certain but death and taxes"

Accepted Answer

A) Mark Twain 
B) Winston Churchill 
C) Benjamin Franklin 
D) Pierre Elliott Trudeau 
A) Mark Twain 
B) Winston Churchill 
C) Benjamin Franklin 
D) Pierre Elliott Trudeau

Question 2

What happens as tax laws become more complex

Accepted Answer

A) The administrative burden of taxes is increased. 
B) Compliance costs will likely decrease. 
C) The government always collects more in tax revenue. 
D) The amount of tax revenue lost to tax evasion always decreases. 
A) The administrative burden of taxes is increased. 
B) Compliance costs will likely decrease. 
C) The government always collects more in tax revenue. 
D) The amount of tax revenue lost to tax evasion always decreases.

Question 3

-Refer to Table 12-8.Which tax illustrates a proportional tax

Accepted Answer

A) tax A 
B) tax B 
C) tax C 
D) tax D 
A) tax A 
B) tax B 
C) tax C 
D) tax D

Question 4

Use Table A to complete Table B.
Table A   Table B

Accepted Answer

The answer of Use Table A to complete Table B.
Table...

Question 5

Which tax system requires all taxpayers to pay the same percentage of their income in taxes

Accepted Answer

A) regressive 
B) proportional 
C) progressive 
D) horizontal equity 
A) regressive 
B) proportional 
C) progressive 
D) horizontal equity

Question 6

Provinces are sometimes given the responsibility of administering federal programs under federal guidelines.What category do these types of programs usually fall into

Accepted Answer

A) defence 
B) CHST 
C) foreign affairs 
D) Old Age Security 
A) defence 
B) CHST 
C) foreign affairs 
D) Old Age Security

Question 7

What is NOT a cost of taxes to taxpayers

Accepted Answer

A) the tax payment itself 
B) deadweight losses 
C) administrative burdens 
D) goods and services provided by the government 
A) the tax payment itself 
B) deadweight losses 
C) administrative burdens 
D) goods and services provided by the government

Question 8

In 2013-2014,what were the approximate EI payroll taxes for the average Canadian

Accepted Answer

A) $145 
B) $500 
C) $612 
D) $1155 
A) $145 
B) $500 
C) $612 
D) $1155

Question 9

If revenue from a gasoline tax is used to build and maintain public roads,on what basis may the gasoline tax be justified

Accepted Answer

A) the benefits principle 
B) the ability-to-pay principle 
C) vertical equity 
D) horizontal equity 
A) the benefits principle 
B) the ability-to-pay principle 
C) vertical equity 
D) horizontal equity

Question 10

Table 12-7
  
-Refer to Table 12-7.If the government imposes a $3000 lump-sum tax,what would be the marginal tax rate for Paulo

Accepted Answer

A) 0 percent 
B) 4 percent 
C) 9 percent 
D) 10 percent 
A) 0 percent 
B) 4 percent 
C) 9 percent 
D) 10 percent

Question 11

Marcus faces a progressive federal income tax structure that has the following marginal tax rates: 0 percent on the first $10,000,10 percent on the next $10,000,15 percent on the next $10,000,25 percent on the next $10,000,and 50 percent on all additional income.In addition,he must pay five percent of his income in provincial income tax and 15.3 percent of his labour income in federal payroll taxes.Marcus earns $60,000 per year in salary and another $10,000 per year in nonlabour income.What is his average tax rate

Accepted Answer

A) 17.19 percent 
B) 46.69 percent 
C) 48.87 percent 
D) 56.01 percent 
A) 17.19 percent 
B) 46.69 percent 
C) 48.87 percent 
D) 56.01 percent

Question 12

Which statement best defines a regressive tax system

Accepted Answer

A) A general sales tax on food is regressive when low-income taxpayers spend a larger proportion of their income on food than high-income taxpayers. 
B) A general sales tax on food is regressive when middle income taxpayers spend a smaller proportion of their income on food than high-income taxpayers. 
C) A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than middle income taxpayers. 
D) A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than low-income taxpayers. 
A) A general sales tax on food is regressive when low-income taxpayers spend a larger proportion of their income on food than high-income taxpayers. 
B) A general sales tax on food is regressive when middle income taxpayers spend a smaller proportion of their income on food than high-income taxpayers. 
C) A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than middle income taxpayers. 
D) A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than low-income taxpayers.

Question 13

A recent increase in federal gasoline taxes was estimated to cause a $150 million reduction in the total (consumer plus producer) surplus in the gasoline market.If tax revenues increased by $100 million,what is the deadweight loss associated with the tax
 As a result of the tax,10,000 people sold their cars and started riding their bicycles to work.How much of the burden of the deadweight loss is incurred by the bicycle riders

Accepted Answer

The direct deadweight loss is $50 millio

Question 14

Suppose the government imposes a tax of 10 percent on the first $40,000 of income and 20 percent on all income above $40,000.What are the tax liability and the marginal tax rate,respectively,for a person whose income is $60,000

Accepted Answer

A) 10 percent and $8000 
B) 20 percent and $8000 
C) $8000 and 10 percent 
D) $8000 and 20 percent 
A) 10 percent and $8000 
B) 20 percent and $8000 
C) $8000 and 10 percent 
D) $8000 and 20 percent

Question 15

Why has spending on health been the focus of many proposed reforms over the past several years

Accepted Answer

A) Health care costs have risen more rapidly than the cost of other goods and services produced in the economy. 
B) Provincial health care systems have demonstrated that they are more efficient than private health care systems. 
C) Cures for many major diseases are likely to be found in the next few years. 
D) Increasing access to doctors will increase the general health of the population. 
A) Health care costs have risen more rapidly than the cost of other goods and services produced in the economy. 
B) Provincial health care systems have demonstrated that they are more efficient than private health care systems. 
C) Cures for many major diseases are likely to be found in the next few years. 
D) Increasing access to doctors will increase the general health of the population.

Question 16

What are vertical equity and horizontal equity associated with

Accepted Answer

A) the benefits principle of taxation 
B) the ability-to-pay principle of taxation 
C) taxes that have no deadweight losses 
D) falling marginal tax rates 
A) the benefits principle of taxation 
B) the ability-to-pay principle of taxation 
C) taxes that have no deadweight losses 
D) falling marginal tax rates

Question 17

A corporate tax on the income of Canadian car companies will NOT likely affect markets in which way

Accepted Answer

A) The price of cars will rise. 
B) The wages of autoworkers will fall. 
C) Owners of car companies (shareholders) will receive less profit. 
D) Less deadweight loss will occur since corporations are entities and not people who respond to incentives. 
A) The price of cars will rise. 
B) The wages of autoworkers will fall. 
C) Owners of car companies (shareholders) will receive less profit. 
D) Less deadweight loss will occur since corporations are entities and not people who respond to incentives.

Question 18

Which of the following is an effect of an income tax

Accepted Answer

A) It distorts incentives. 
B) It discourages the poor to save more. 
C) It discourages the rich to save more. 
D) It reduces the administrative burden of taxation. 
A) It distorts incentives. 
B) It discourages the poor to save more. 
C) It discourages the rich to save more. 
D) It reduces the administrative burden of taxation.

Question 19

Lump-sum taxes are equitable but not efficient.

Accepted Answer

A) True 
 B)False

Question 20

When government receipts fall short of spending,the government is said to run a budget surplus.

Accepted Answer

A) True 
 B)False

Who said,"In this world nothing is certain but death and taxes"

What happens as tax laws become more complex

-Refer to Table 12-8.Which tax illustrates a proportional tax

Use Table A to complete Table B. Table A Table B

Which tax system requires all taxpayers to pay the same percentage of their income in taxes

Provinces are sometimes given the responsibility of administering federal programs under federal guidelines.What category do these types of programs usually fall into

What is NOT a cost of taxes to taxpayers

In 2013-2014,what were the approximate EI payroll taxes for the average Canadian

If revenue from a gasoline tax is used to build and maintain public roads,on what basis may the gasoline tax be justified

Table 12-7 -Refer to Table 12-7.If the government imposes a $3000 lump-sum tax,what would be the marginal tax rate for Paulo

Which statement best defines a regressive tax system

Suppose the government imposes a tax of 10 percent on the first $40,000 of income and 20 percent on all income above $40,000.What are the tax liability and the marginal tax rate,respectively,for a person whose income is $60,000

Why has spending on health been the focus of many proposed reforms over the past several years

What are vertical equity and horizontal equity associated with

A corporate tax on the income of Canadian car companies will NOT likely affect markets in which way

Which of the following is an effect of an income tax

Lump-sum taxes are equitable but not efficient.

When government receipts fall short of spending,the government is said to run a budget surplus.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, demand, and Government Policies

Consumers, producers, and the Efficiency of Markets

Application: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Exam 12: The Design of the Tax System

Who said,"In this world nothing is certain but death and taxes"

What happens as tax laws become more complex

-Refer to Table 12-8.Which tax illustrates a proportional tax

Use Table A to complete Table B. Table A Table B

Which tax system requires all taxpayers to pay the same percentage of their income in taxes

Provinces are sometimes given the responsibility of administering federal programs under federal guidelines.What category do these types of programs usually fall into

What is NOT a cost of taxes to taxpayers

In 2013-2014,what were the approximate EI payroll taxes for the average Canadian

If revenue from a gasoline tax is used to build and maintain public roads,on what basis may the gasoline tax be justified

Table 12-7 -Refer to Table 12-7.If the government imposes a $3000 lump-sum tax,what would be the marginal tax rate for Paulo

Which statement best defines a regressive tax system

Suppose the government imposes a tax of 10 percent on the first $40,000 of income and 20 percent on all income above $40,000.What are the tax liability and the marginal tax rate,respectively,for a person whose income is $60,000

Why has spending on health been the focus of many proposed reforms over the past several years

What are vertical equity and horizontal equity associated with

A corporate tax on the income of Canadian car companies will NOT likely affect markets in which way

Which of the following is an effect of an income tax

Lump-sum taxes are equitable but not efficient.

When government receipts fall short of spending,the government is said to run a budget surplus.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, demand, and Government Policies

Consumers, producers, and the Efficiency of Markets

Application: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters