Econ exam 2
A budget surplus occurs when
tax revenue exceeds government spending
Taxes listed as federal insurance contribution act taxes on the employee paystub are
Payroll taxes
I'm the United States income taxes are
Progressice
__________ is the amount of money a government collects through a tax
tax revenue
In a progressive tax system
the marginal tax rate exceeds the average tax rate
If Kate pays an average tax rate of 12.5% and her total income is $34,000, she pays ________ as tax.
$4,250
What is the budget surplus if the total amount of taxes collected by a local government is $171,000 and the total amount spent is $90,000?
$81,000
T or F: A consumers tastes and preferences determine the satisfaction she receives from consumption
True
T or F: the central as well as the local governments collect taxes in the U.S.
True
A tax collected at each stage of the production process is called a _______ tax
Value added (similar to sales tax)
Joseph earns $75000 monthly. If his average tax rate is 18% what is the total amount of money that he pays as tax ?
$13,500
If the total revenue collected by the federal gov. In a particular year is $1.2 billion and the total amount spent by the gov. During this year is $3.8 billion, what is the budget deficit?
$2.6 million
The government of Lithasia ran a budget deficit of $60,000 in 2012. If the the tax revenue of the Lithuanian Gov in 2012 was $320,000,000 how much did the gov spend in that year?
$320,060,000
Mr.smith pays $20,000 annually as tax. If his annual income is $100,000 what is his average tax?
20%
Over the years, the U.S. government spending has ________.
increased and government revenue has also increased
The largest source of the federal tax revenue is
individual income taxes
In a _____ tax system, the marginal tax rate declines with income
Regressive
Social security taxes in the US tend to be
Regressive
______ taxes are paid by a buyer as a % of the market price of an item
Sales
A payroll tax is also know as a ________ tax. (Tax employers withhold from employees pay)
Social insurance tax
The second largest component of the federal gov revenues is recipes from
Social insurance tax
Which of the following taxes is collected only by federal government ?
Social insurance tax
Which of the following programs provide economic security for the elderly, disabled, widow and fatherless children in the US
Social security
In a proportional tax system,
The average tax rate equals the marginal tax rate
Which of the following is true of individual income taxed
The rate of the income tax imposed by state's in the US varies
Which of the following is collected only by local and state gov?
Toll taxes
In a regressive tax system,
low income households pay a higher percentage of their income as taxes
The marginal income tax rate is the
percentage of the last dollar earned that a household pays in taxes
The contribution of _____ to federal tax receipts is larger than the contribution of ____
personal income taxes; corporate income taxes
The federal government relies on _____ to limit inequality
progressive taxes
One reason governments impose taxes is to ________.
redistribute funds via transfer payments
The government redistributes funds via transfer payments in order to
reduce inequality among the citizens
_______ is generates from taxing profits earned by firms
Corporate income tax
Which of the following is not a direct determining factor of a consumers purchase decisions?
Cost of factor inputs
_______ taxes are taxes paid when purchasing specific food such as alcohol, tabaco, & gasoline
Excise
Which of the following correctly describes incentives?
Incentives are rewards or penalties that motivate people to behave in a particular way.
Which of the following account for the largest portion of state and local gov receipts
Miscellaneous taxes and fees
Which of the following accounts for the largest portion of federal gov spending
National defense
A _____ tax system is one in which tax rates increase with taxable base incomes
Progressive
Local government usually rely on the ____ tax to fund schools, libraries, & public services like police and fire protection
Property
A ______ system is one in which households pay the same % of their incomes in taxes regardless of their income level
Propotional
The state governments in the US spend a larger percentage of their funds on
Public welfare
A consumers budget refers to the
amount of money she can spend on various goods and services
A ___________ occurs when government spending exceeds tax revenue.
budget deficit
A restaurant charges its customers 12% of the total food price as tax. This is an example of a ________ tax.
sales
The average tax rate faced by an individual is the
total tax paid by her divided by the total income earned
