Question 1

The largest category of federal spending is for:

Accepted Answer

A)  health care. 
B)  science,space,and technology. 
C)  pensions and income security. 
D)  national defense. 
A)  health care. 
B)  science,space,and technology. 
C)  pensions and income security. 
D)  national defense.

Question 2

If you would have to pay $5,000 in taxes on a $25,000 taxable income and $7,000 on a $30,000 taxable income,then the marginal tax rate on the additional $5,000 of income is:

Accepted Answer

A)  40 percent and the average tax rate is about 23 percent at the $30,000 income level. 
B)  50 percent and the average tax rate is 40 percent at the $30,000 income level. 
C)  40 percent and the average tax rate is 25 percent at the $25,000 income level. 
D)  30 percent,but average tax rates cannot be determined from the information given. 
A)  40 percent and the average tax rate is about 23 percent at the $30,000 income level. 
B)  50 percent and the average tax rate is 40 percent at the $30,000 income level. 
C)  40 percent and the average tax rate is 25 percent at the $25,000 income level. 
D)  30 percent,but average tax rates cannot be determined from the information given.

Question 3

The efficiency loss of a tax is the tax revenue collected by government minus the value of the public goods financed through the tax.

Accepted Answer

A) True 
 B)False

Question 4

(Advanced analysis)Answer the question on the basis of the following information: The equations for the demand and supply curves for a particular product are P = 10 - .4Q and P = 2 + .4Q,where P is price and Q is quantity expressed in units of 100.After an excise tax is imposed on the product,the supply equation is P = 3 + .4Q. Refer to the given information.The excise tax on each unit of the product:

Accepted Answer

A)  is $1. 
B)  is $2. 
C)  is $3. 
D)  cannot be determined with the information given. 
A)  is $1. 
B)  is $2. 
C)  is $3. 
D)  cannot be determined with the information given.

Question 5

An income tax is progressive if the:

Accepted Answer

A)  absolute amount paid as taxes varies directly with income. 
B)  percentage of income paid as taxes is the same regardless of the size of income. 
C)  percentage of income paid as taxes increases as income increases. 
D)  tax rate varies inversely with income. 
A)  absolute amount paid as taxes varies directly with income. 
B)  percentage of income paid as taxes is the same regardless of the size of income. 
C)  percentage of income paid as taxes increases as income increases. 
D)  tax rate varies inversely with income.

Question 6

At the state and local levels of the U.S.government,a majority of government employees work in which of the following areas?

Accepted Answer

A)  Postal service. 
B)  Education. 
C)  Hospitals and other health care. 
D)  Police and corrections. 
A)  Postal service. 
B)  Education. 
C)  Hospitals and other health care. 
D)  Police and corrections.

Question 7

The following data represent a personal income tax schedule.Answer the question on the basis of this information. $$\begin{array} { c c } 
\text { Taxable Income } & \text { Total Tax } \
\hline
\$ 0 & \$ 0 \
2,000 & 200 \
4,000 & 600 \
6,000 & 1,200 \
8,000 & 2,000 \
10,000 & 3,000
\end{array}$$ Refer to the table.This tax is such that the after-tax distribution of income will be:

Accepted Answer

A)  more equal than the before-tax distribution. 
B)  less equal than the before-tax distribution. 
C)  distributed in precisely the same way as the before-tax distribution. 
D)  less than the before-tax distribution by the same percentage at each income level. 
A)  more equal than the before-tax distribution. 
B)  less equal than the before-tax distribution. 
C)  distributed in precisely the same way as the before-tax distribution. 
D)  less than the before-tax distribution by the same percentage at each income level.

Question 8

A progressive tax takes relatively more from the rich than it does from the poor.

Accepted Answer

A) True 
 B)False

The largest category of federal spending is for:

If you would have to pay $5,000 in taxes on a $25,000 taxable income and $7,000 on a $30,000 taxable income,then the marginal tax rate on the additional $5,000 of income is:

The efficiency loss of a tax is the tax revenue collected by government minus the value of the public goods financed through the tax.

An income tax is progressive if the:

At the state and local levels of the U.S.government,a majority of government employees work in which of the following areas?

The following data represent a personal income tax schedule.Answer the question on the basis of this information. Taxable Income Total Tax \ 0 \ 0 2,000 200 4,000 600 6,000 1,200 8,000 2,000 10,000 3,000 Refer to the table.This tax is such that the after-tax distribution of income will be:

A progressive tax takes relatively more from the rich than it does from the poor.

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Cost of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition and Oligopoly

Technology RD and Efficiency

The Demand for Resources

Wage Determination

Rent Interest and Profit

Natural Resource and Energy Economics

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Filters

Exam 19: Public Finance: Expenditures and Taxes

The largest category of federal spending is for:

If you would have to pay $5,000 in taxes on a $25,000 taxable income and $7,000 on a $30,000 taxable income,then the marginal tax rate on the additional $5,000 of income is:

The efficiency loss of a tax is the tax revenue collected by government minus the value of the public goods financed through the tax.

An income tax is progressive if the:

At the state and local levels of the U.S.government,a majority of government employees work in which of the following areas?

The following data represent a personal income tax schedule.Answer the question on the basis of this information. Taxable Income Total Tax \ 0 \ 0 2,000 200 4,000 600 6,000 1,200 8,000 2,000 10,000 3,000 Refer to the table.This tax is such that the after-tax distribution of income will be:

A progressive tax takes relatively more from the rich than it does from the poor.

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Cost of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition and Oligopoly

Technology RD and Efficiency

The Demand for Resources

Wage Determination

Rent Interest and Profit

Natural Resource and Energy Economics

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Filters