Question 1

Table 12-2
 
-Refer to Table 12-2.The price of a weekend ski pass is $138 and this price reflects the actual unit cost of providing a weekend of skiing.If the government imposes a tax of $15 on each weekend ski pass,what is the deadweight loss associated with the tax

Accepted Answer

A)  $2
B)  $37
C)  $52
D)  $79E) None of the above
F) B) and C)

Question 2

The payroll tax differs from the individual income tax in that the payroll tax is primarily earmarked to pay for which of the following

Accepted Answer

A)  employer-provided pensions
B)  employment insurance
C)  employer-provided health benefits
D)  job loss and training programsE) A) and B)
F) None of the above

Question 3

Which statement best describes the legality of tax avoidance and tax evasion

Accepted Answer

A)  Tax avoidance and tax evasion are both legal.
B)  Tax avoidance and tax evasion are both illegal.
C)  Tax avoidance is legal and tax evasion is illegal.
D)  Tax avoidance is illegal and tax evasion is legal.E) All of the above
F) None of the above

Question 4

Table 12-1 
-Refer to Table 12-1.If Janine makes $97,500 this year,what would her tax liability be,approximately

Accepted Answer

A)  $18,525
B)  $25,350
C)  $28,275
D)  $29,740E) A) and C)
F) A) and D) B

Question 5

On what basis is a tax on expensive speed boats that are purchased only by the wealthy NOT likely to satisfy the condition of vertical equity

Accepted Answer

A)  Wealthy buyers are most likely to be subject to the implications of the flypaper theory of tax incidence.
B)  Horizontal equity is most associated with a tax on luxury items.
C)  Buyers can easily substitute other luxuries for expensive speedboats.
D)  It is very unlikely that the burden of the tax will fall on workers who make the expensive speed boats.E) A) and C)
F) C) and D)

Question 6

Scenario 12-1
Suppose Jeremy and Kelsey receive great satisfaction from their consumption of turkey.Kelsey would be willing to purchase only one slice and would pay up to $5 for it.Jeremy would be willing to pay $8 for his first slice, $6 for his second slice, and $2 for his third slice.The current market price is $2 per slice.
-Refer to Scenario 12-1.Assume that the government places a tax of $4 on each slice of turkey.What is Kelsey's consumer surplus from turkey

Accepted Answer

A)  $0
B)  $2
C)  $3
D)  $6E) All of the above
F) B) and D)

Question 7

What is NOT an administrative burden of our tax system

Accepted Answer

A)  government resources used to enforce tax laws
B)  keeping tax records throughout the year
C)  making charitable contributions at the end of the year for tax deductions
D)  time spent filling out tax formsE) A) and B)
F) A) and C)

Question 8

If the government imposes a tax of $3000 on everyone,what would this tax best be described as

Accepted Answer

A)  an income tax
B)  a consumption tax
C)  a lump-sum tax
D)  a marginal taxE) A) and D)
F) A) and C)

Question 9

In 1980,what percentage of total income did Canadian governments collect in taxes

Accepted Answer

A)  approximately 20 percent
B)  approximately 28 percent
C)  approximately 32 percent
D)  approximately 40 percentE) B) and C)
F) A) and B)

Question 10

Antipoverty programs funded by taxes on the wealthy are sometimes advocated on the basis of the benefits principle.

Accepted Answer

A) True 
 B)False  True

Question 11

MaKenna earns income of $80,000 per year.Her average tax rate is 30 percent.MaKenna paid 20 percent in taxes on the first $30,000 she earned.What was the marginal tax rate on the rest of her income

Accepted Answer

A)  20 percent
B)  24 percent
C)  30 percent
D)  36 percentE) All of the above
F) B) and C)

Question 12

Which of the following claims that all citizens should make an "equal sacrifice" to support government programs usually associated with

Accepted Answer

A)  the ability-to-pay principle
B)  the benefits principle
C)  efficiency arguments
D)  regressive tax argumentsE) A) and C)
F) B) and D)

Question 13

When the government levies a tax on a corporation,what results

Accepted Answer

A)  All the burden of the tax ultimately falls on owners.
B)  The corporation is more like a tax collector than a taxpayer.
C)  Output must increase to compensate for reduced profits.
D)  Less deadweight loss will occur since corporations are entities and not people who respond to incentives.E) A) and D)
F) B) and D)

Question 14

The efficiency of a tax system refers to the costs it imposes on taxpayers related to the revenue collected.

Accepted Answer

A) True 
 B)False  True

Question 15

Which country has the largest tax burden

Accepted Answer

A)  France
B)  Italy
C)  Germany
D)  CanadaE) All of the above
F) B) and C)

Question 16

How do policymakers consider goals of efficiency and equity in tax policy

Accepted Answer

A)  complementary in most countries
B)  necessary for application of the ability-to-pay principle
C)  often in conflict with each other
D)  more easily sustained when tax laws are complexE) None of the above
F) A) and B)

Question 17

When the marginal tax rate exceeds the average tax rate,what is the tax called

Accepted Answer

A)  proportional
B)  regressive
C)  disproportional
D)  progressiveE) A) and B)
F) All of the above

Question 18

Evaluate the statement: Tax loopholes increase the efficiency of tax systems.

Accepted Answer

In some cases,tax loopholes are designed...

Question 19

What is a consumption tax

Accepted Answer

A)  a tax on goods but not services
B)  a tax on the amount of income that people spend
C)  a tax on services but not goods
D)  a tax on the amount of income that people earnE) A) and C)
F) All of the above

Question 20

What do most people agree about the tax system

Accepted Answer

A)  It should be both efficient and equitable.
B)  It cannot raise enough revenue to cover government expenditures.
C)  It could raise more revenue if tax rates were lowered.
D)  It should be rewritten to require everyone to pay the same percentage of their income to taxes.E) A) and B)
F) A) and C)

Exam 12: The Design of the Tax System

Table 12-2 -Refer to Table 12-2.The price of a weekend ski pass is $138 and this price reflects the actual unit cost of providing a weekend of skiing.If the government imposes a tax of $15 on each weekend ski pass,what is the deadweight loss associated with the tax

Correct Answer
verified

The payroll tax differs from the individual income tax in that the payroll tax is primarily earmarked to pay for which of the following

Correct Answer
verified

Which statement best describes the legality of tax avoidance and tax evasion

Correct Answer
verified

Table 12-1 -Refer to Table 12-1.If Janine makes $97,500 this year,what would her tax liability be,approximately

Correct Answer
verified
B

On what basis is a tax on expensive speed boats that are purchased only by the wealthy NOT likely to satisfy the condition of vertical equity

Correct Answer
verified

Correct Answer
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What is NOT an administrative burden of our tax system

Correct Answer
verified

If the government imposes a tax of $3000 on everyone,what would this tax best be described as

Correct Answer
verified

In 1980,what percentage of total income did Canadian governments collect in taxes

Correct Answer
verified

Antipoverty programs funded by taxes on the wealthy are sometimes advocated on the basis of the benefits principle.

Correct Answer
verified
True

MaKenna earns income of $80,000 per year.Her average tax rate is 30 percent.MaKenna paid 20 percent in taxes on the first $30,000 she earned.What was the marginal tax rate on the rest of her income

Correct Answer
verified

Which of the following claims that all citizens should make an "equal sacrifice" to support government programs usually associated with

Correct Answer
verified

When the government levies a tax on a corporation,what results

Correct Answer
verified

The efficiency of a tax system refers to the costs it imposes on taxpayers related to the revenue collected.

Correct Answer
verified
True

Which country has the largest tax burden

Correct Answer
verified

How do policymakers consider goals of efficiency and equity in tax policy

Correct Answer
verified

When the marginal tax rate exceeds the average tax rate,what is the tax called

Correct Answer
verified

Evaluate the statement: Tax loopholes increase the efficiency of tax systems.

Correct Answer
verified
In some cases,tax loopholes are designed...
View Answer

What is a consumption tax

Correct Answer
verified

What do most people agree about the tax system

Correct Answer
verified

Exam 12: The Design of the Tax System

Table 12-2 -Refer to Table 12-2.The price of a weekend ski pass is $138 and this price reflects the actual unit cost of providing a weekend of skiing.If the government imposes a tax of $15 on each weekend ski pass,what is the deadweight loss associated with the tax

Correct AnswerverifiedShow Answer

The payroll tax differs from the individual income tax in that the payroll tax is primarily earmarked to pay for which of the following

Correct AnswerverifiedShow Answer

Which statement best describes the legality of tax avoidance and tax evasion

Correct AnswerverifiedShow Answer

Table 12-1 -Refer to Table 12-1.If Janine makes $97,500 this year,what would her tax liability be,approximately

Correct AnswerverifiedB

On what basis is a tax on expensive speed boats that are purchased only by the wealthy NOT likely to satisfy the condition of vertical equity

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What is NOT an administrative burden of our tax system

Correct AnswerverifiedShow Answer

If the government imposes a tax of $3000 on everyone,what would this tax best be described as

Correct AnswerverifiedShow Answer

In 1980,what percentage of total income did Canadian governments collect in taxes

Correct AnswerverifiedShow Answer

Antipoverty programs funded by taxes on the wealthy are sometimes advocated on the basis of the benefits principle.

Correct AnswerverifiedTrue

MaKenna earns income of $80,000 per year.Her average tax rate is 30 percent.MaKenna paid 20 percent in taxes on the first $30,000 she earned.What was the marginal tax rate on the rest of her income

Correct AnswerverifiedShow Answer

Which of the following claims that all citizens should make an "equal sacrifice" to support government programs usually associated with

Correct AnswerverifiedShow Answer

When the government levies a tax on a corporation,what results

Correct AnswerverifiedShow Answer

The efficiency of a tax system refers to the costs it imposes on taxpayers related to the revenue collected.

Correct AnswerverifiedTrue

Which country has the largest tax burden

Correct AnswerverifiedShow Answer

How do policymakers consider goals of efficiency and equity in tax policy

Correct AnswerverifiedShow Answer

When the marginal tax rate exceeds the average tax rate,what is the tax called

Correct AnswerverifiedShow Answer

Evaluate the statement: Tax loopholes increase the efficiency of tax systems.

Correct AnswerverifiedIn some cases,tax loopholes are designed...View AnswerShow Answer

What is a consumption tax

Correct AnswerverifiedShow Answer

What do most people agree about the tax system

Correct AnswerverifiedShow Answer

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B

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True

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True

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Correct Answer
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In some cases,tax loopholes are designed...
View Answer

Correct Answer
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Correct Answer
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