Exam 19: Public Finance: Expenditures and Taxes

Assume the Environmental Protection Agency imposes an excise tax on polluting firms.In which of the following situations would we expect the additional costs to be borne most heavily by consumers?

The basic source of state government's revenue is the property tax.

The basic tax rate on taxable corporate income is:

The efficiency loss of a tax is:

The addition of government to the circular-flow model illustrates that government:

The marginal tax rate is:

The U.S.tax-transfer system (as distinct from the tax system alone)is:

The average tax rate is:

The greater the elasticity of demand and supply,the greater is the efficiency loss of a tax.

Government lotteries are:

Answer the question on the basis of the following five schedules,all of which represent income tax schedules for an economy.All figures are in billions of dollars. $\quad$ $\quad$ $\quad$ $\quad$ I $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ II $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ III $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ IV $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$ V \ 30 50 60 70 Base \ 100 200 300 400 \ 10 20 30 40 Base \ 100 200 300 400 \ 5 15 30 50 Base \ 100 200 300 400 \ 30 60 90 120 Base \ 100 200 300 400 \ 10 30 60 100 Base \ 100 200 300 400 Which of the schedules represent(s)a regressive tax?

Economists agree that corporations always shift the corporate income tax to consumers by raising product prices.

Sales and excise taxes are levied on retailers,but retailers add these taxes to the prices of their products.This illustrates the:

Overall,the U.S.tax system (combined federal,state,and local)is:

The opportunity cost of borrowing funds to finance government deficits is:

Assume that in year 1 you pay an average tax rate of 20 percent on a taxable income of $20,000.In year 2,you pay an average tax rate of 25 percent on a taxable income of $30,000.Assuming no change in tax rates,the marginal tax rate on your additional $10,000 of income is:

(Consider This)Which of the following claims is not made by defenders of lotteries?

The benefits-received principle of taxation is most evident in:

Government purchases and transfer payments:

About two-thirds of all federal spending is for national defense.