Exam 12: The Design of the Tax System

Table 12-6 The table below shows the marginal tax rates for an unmarried taxpayer for various levels of taxable income. -Refer to Table 12-6. For this tax schedule, what is the average tax rate for an individual with $49,000 in taxable income?

Table 12-19 -Refer to Table 12-19. The tax system is

Define the marginal tax rate.

Country A's tax system is more efficient than Country B's tax system if

Which of the following contributes to the projected rise in government spending on Social Security and Medicare as a percentage of GDP?

Which of the following is not true about government spending on national defense?

The principle that people should pay taxes based on the benefits they receive from government services is called the

Most people agree that taxes should impose as small a cost on society as possible and that the burden of taxes should be distributed fairly.

Which of the following is an important reason for the projected increase in government spending as a percentage of GDP over the next several decades?

The most efficient tax possible is a

Suppose the government taxes 30 percent of the first $70,000 and 50 percent of all income above $70,000. For a person earning $100,000, the marginal tax rate is

Table 12-5 -Refer to Table 12-5. What is the marginal tax rate for a person who makes $120,000?

If a tax takes a smaller fraction of income as income rises, it is

Table 12-23 The dollar amounts in the last three columns are the taxes owed under the three different tax systems. -Refer to Table 12-23. Which of the three tax systems exhibits vertical equity?

Goals of efficiency and equity in tax policy are

An excise tax is a tax on a specific good, like gasoline.

As a person's or family's income rises, the marginal federal income tax rate .

From the time of Benjamin Franklin to the present, the percentage of the average American's income that goes to pay taxes has

Suppose the government taxes 10 percent of the first $40,000 of income and 20 percent of all income over $40,000. Shahina paid $10,000 in taxes. What were her marginal and average tax rates?

The U.S. federal government collects taxes in a number of ways. Rank the following sources of revenue from the largest to the smallest.