Exam 16: The Distribution of Income and Social Policy

Figure 16.2 Figure 16.2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 16.2.If the government imposes an excise tax of $1.00 on every unit sold, the consumer's burden of the tax

The excess burden of a tax

Income inequality increases as the Gini coefficient approaches 1.

If the marginal tax rate is greater than the average tax rate, the tax structure is described as regressive.

If the marginal tax rate is equal to the average tax rate as taxable income increases, the tax structure is

There is a difference between who is legally required to send a tax payment to the government and who bears the burden of the tax.Which of the following would have the most impact on who bears the burden of an excise tax?

The term 'payroll taxes' is often used to refer to

If the government is most interested in minimising excess burden of an excise tax, should it impose the tax on goods that are elastic or on goods that are inelastic?

Figure 16.2 Figure 16.2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 16.2.If the government imposes an excise tax of $1.00 on every unit sold, what is the size of the deadweight loss, if there is any?

How are exemptions and deductions used?

The actual division of the burden of a tax is called

Figure 16.6 Figure 16.6 shows the Lorenz curves for Islandia and Syldavia. -Refer to Figure 16.6.Which country has the more unequal distribution of income?

Figure 16.1 -Refer to Figure 16.1.The sales tax revenue collected by the government is represented by the area

If you pay $3000 in taxes on an income of $28 000, and $4450 in taxes on an income of $38 000, what is your marginal tax rate? Show your work.

Figure 16.1 -Refer to Figure 16.1.Area B + C + F + G represents

Horizontal equity is achieved when taxes are collected from those who benefit from the government expenditure of the tax revenue.

If grocery stores were legally required to charge a 10-cent fee for disposable grocery bags, who would bear the largest burden of this fee?

Figure 16.2 Figure 16.2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 16.2.If the government imposes an excise tax of $1.00 on every unit sold, the producer's burden of the tax

What is meant by 'tax incidence'?

The idea that two taxpayers in the same economic circumstances should pay the same level of taxes is known as the