chapter 12 - Chapter 12 The Design of the Tax System...

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Unformatted text preview: Chapter 12 The Design of the Tax System TRUE/FALSE 1. The average American pays a higher percent of his income in taxes today than he would have in the late 18th century. ANS: T DIF: 1 REF: 12-0 NAT: Analytic LOC: The role of government TOP: Tax burden MSC: Applicative 2. The U.S. tax burden is high compared to many European countries, but is low compared to many other nations in the world. ANS: F DIF: 1 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Tax burden MSC: Applicative 3. Poor countries such as India and Pakistan usually have low tax burdens. ANS: T DIF: 1 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Tax burden MSC: Applicative 4. The U.S. federal government collects about one-half of the taxes in our economy. ANS: F DIF: 1 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Tax burden MSC: Applicative 5. Individual income taxes and social insurance taxes generate the highest tax revenue for the federal government. ANS: T DIF: 2 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Taxes MSC: Applicative 6. Individual income taxes generate rougly 25% of the tax revenue for the federal government. ANS: F DIF: 2 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Taxes MSC: Applicative 7. Income taxes and property taxes generate the highest tax revenue for state and local governments. ANS: F DIF: 2 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Taxes MSC: Applicative 8. Sales taxes generate nearly 50% of the tax revenue for state and local governments. ANS: F DIF: 2 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Taxes MSC: Applicative 9. Some states do not have a state income tax. ANS: T DIF: 1 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Income taxes MSC: Applicative 10. By law, all states must have a state income tax. ANS: F DIF: 1 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Income taxes MSC: Applicative 13 14 Chapter 12 /The Design of the Tax System 11. Social Security is an income support program, designed primarily to maintain the living standards of the poor. ANS: F DIF: 2 REF: 12-1 NAT: Analytic LOC: The role of government TOP: Government spending MSC: Applicative 12. A budget surplus occurs when government receipts fall short of government spending. ANS: F DIF: 1 REF: 12-1 NAT: Analytic LOC: The study of economics, and definitions of economics TOP: Budget surpluses MSC: Definitional 13. A budget surplus occurs when government receipts exceed government spending. ANS: T DIF: 1 REF: 12-1 NAT: Analytic LOC: The study of economics, and definitions of economics TOP: Budget surpluses MSC: Definitional 14. A budget deficit occurs when government receipts exceed government spending....
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chapter 12 - Chapter 12 The Design of the Tax System...

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