PLQ19 & HW19

Which of the following is the percentage of annual US government spending allocated to foreign aid?

1%

In 2009, the U.S. government spent $1.4 trillion more than it collected in taxes. This deficit was about:

10% of the size of the U.S. GDP in 2009

A government collects $70 billion quarterly in tax revenue. Each year it allocates $15 billion to the justice system and $29 billion for the administrative costs. What percentage of its total annual tax revenue is left for allocation to the remaining categories of government spending?

84.29%

What do goods like gasoline, tobacco, and alcohol typically share in common?

They are all subject to government excise taxes

The federal government levies _____________________________ on people who pass assets ____________________________, either after death or during life.

an estate and gift tax; to the next generation

A ______________________ means that government spending and taxes are equal.

balanced budget

In 2010, Microsoft will pay corporate income tax to the federal government based on the company's __________________.

corporate profits

Which of the following terms is used to describe the set of policies that relate to government spending, taxation, and borrowing?

fiscal policies

A __________________________ policy will cause a greater share of income to be collected from those with high incomes than from those with lower incomes.

progressive tax

If government tax policy requires Bill to pay $20,000 in taxes on annual income of $200,000 and Paul to pay $10,000 in tax on annual income of $100,000, then the tax policy is:

proportional

A ________________________________ is calculated as a flat percentage of income earned, regardless of level of income.

proportional tax

If South Dakota's governor reports a budget surplus in 2011, that state government likely:

received more in taxes than it spent in that year

If government tax policy requires Peter to pay $15,000 in tax on annual income of $200,000 and Paul to pay $10,000 in tax on annual income of $100,000, then the tax policy is:

regressive

A ______________________ is created each time the federal government spends more than it collects in taxes in a given year.

budget deficit

When the government passes a new law that explicitly changes overall tax or spending levels, it is enacting:

discretionary fiscal policy

If a government reduces taxes in order to increase the level of aggregate demand, what type of fiscal policy is being used?

expansionary

If a country's GDP increases, but its debt decreases during that year, then the country's debt to GDP ratio for the year will _______________ in proportion to the magnitude of the changes.

increase or decrease