CHAPTER 2 PROPERTY REVIEW QUESTIONS

Ad Valorem means which of the following? a. According to ability to pay b. According to value c. According to purchase price d. According to net income

According to value

Select whether the following statements are true or false. a. T F Assessed Value / Market Value = Assessment Level b. T F Effective Tax Rate x Market Value = Tax Due c. T F When the assessed value differs from market value, the nominal tax rate will differ from the effective tax rate.

All True

_____ taxes attempt to reduce the tax incidence of people with smaller incomes, as they shift the incidence disproportionately to those with higher incomes.

Progressive

Which of the following taxes is based on an assessed value? A. Sales Tax B. Income Tax C. Property Tax D. Thumb Tax

Property Tax

Which of the following is false regarding the nominal tax rate? a. The nominal tax rate multiplied by the assessment level equals the effective tax rate. b. The nominal tax rate is equal to the tax due divided by the assessed value. c. The nominal rate is based on the spending requirements of the jurisdiction. d. The nominal rate is the tax due divided by the market value.

The nominal rate is the tax due divided by the market value.

A ______ tax is a tax imposed so that the effective tax rate decreases as the amount to which the rate is applied increases.

regressive