Chapter 14 Quiz Kennedy 2nd Block

2.

A budget deficit occurs when expenditures exceed

Revenues
Borrowing
Appropriations
Inflation
Authorization

Correct Answer

A. Revenues

Explanation

A budget deficit occurs when expenditures exceed revenues. This means that the amount of money spent by the government is greater than the amount of money it receives through various sources such as taxes and fees. This can lead to a shortfall in funds and may require the government to borrow money or make appropriations from other sources to cover the deficit. Inflation and authorization are not directly related to budget deficits.

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3.

The income tax is generally progressive, meaning that

It increases incrementally on an annual basis
Those with more income pay higher rates of tax on their income
Those with more income pay more taxes than those with less income
It is a newer form of taxation than sales taxes
It is better than a flat tax

Correct Answer

A. Those with more income pay higher rates of tax on their income

Explanation

The correct answer is that those with more income pay higher rates of tax on their income. This means that as a person's income increases, they are required to pay a higher percentage of their income in taxes. This is a progressive system because it aims to distribute the tax burden more equitably by placing a greater burden on those who can afford to pay more.

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4.

Which federal agency was created in order to collect the federal income tax?

Congressional Budget Office
Treasury Department
General Accounting Office
Auditors General
Internal Revenue Service

Correct Answer

A. Internal Revenue Service

Explanation

The correct answer is the Internal Revenue Service. The IRS was created to collect the federal income tax. It is responsible for enforcing tax laws and regulations, processing tax returns, and collecting taxes from individuals and businesses. The agency plays a crucial role in funding the government through the collection of taxes, ensuring compliance with tax laws, and providing taxpayer assistance and education.

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5.

Tax expenditures are

Sales taxes paid when goods and services are purchased
Money spent by the IRS collecting taxes
Rebates provided to individuals who have overpaid federal taxes
Revenue losses that result from special exemptions, exclusions, or deductions on federal tax law
Income that is taxable by the federal government

Correct Answer

A. Revenue losses that result from special exemptions, exclusions, or deductions on federal tax law

Explanation

Tax expenditures refer to revenue losses that occur as a result of special exemptions, exclusions, or deductions in federal tax laws. These provisions allow certain individuals or entities to reduce their tax liability, resulting in a loss of revenue for the government. Examples of tax expenditures include deductions for mortgage interest, exemptions for certain types of income, and credits for specific activities or investments. These provisions are intended to incentivize certain behaviors or support specific industries or groups, but they reduce the amount of tax revenue collected by the government.

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6.

Tax expenditures tend most to benefit

Lower-income people
Lower middle-class and small business
The government
Middle and upper income people and corporations
State and local governments

Correct Answer

A. Middle and upper income people and corporations

Explanation

Tax expenditures refer to provisions in the tax code that provide special benefits or preferences to certain groups or activities. These provisions often result in a reduction in tax liability for those who qualify. Middle and upper income people and corporations tend to benefit the most from tax expenditures because they typically have higher incomes and more resources to take advantage of these provisions. Lower-income people and lower middle-class individuals may also benefit to some extent, but the magnitude of the benefit is generally greater for those with higher incomes. State and local governments may also benefit from tax expenditures, but they are not the primary beneficiaries.

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7.

Which of the following best describes incrementalism?

It is the best predictor of next year's budget
It provides a minimum level of income to older Americans
It is necessary to pay for big government
It is not determined by a fixed amount of money
It is necessary to balance the budget

Correct Answer

A. It is the best predictor of next year's budget

8.

An example of incremental budgeting is

Reviewing an agency's budget to establish a lower base
Carter's zero-based budgeting
Reducing an agency's budget a little each year
Giving an agency a little more than it had last year
Breaking a budget into its components for review

Correct Answer

A. Giving an agency a little more than it had last year

Explanation

Incremental budgeting involves giving an agency a little more than it had in the previous year. This approach assumes that the previous year's budget was appropriate and makes small adjustments to it rather than starting from scratch. It is a common method used in budgeting as it allows for stability and gradual changes over time. By providing a slight increase in funding, the agency can continue its operations and potentially make improvements or expand its services.

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9.

In the House of Representatives, it is the __________Committee that writes tax codes, subject to the approval of Congress as a whole.

Ways and Means
Appropriations
Budget
Revenue
Finance

Correct Answer

A. Ways and Means

Explanation

The correct answer is "Ways and Means." In the House of Representatives, the Ways and Means Committee is responsible for writing tax codes. These tax codes are then subject to the approval of Congress as a whole. The committee plays a crucial role in shaping the nation's tax policy and ensuring that the government has the necessary revenue to fund its programs and initiatives.

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10.

The heads of executive agencies send their budget requests to the

Office of Management and Budget
Congressional tax committee
President
Treasury Department
House Ways and Means Committee

Correct Answer

A. Office of Management and Budget

Explanation

The heads of executive agencies send their budget requests to the Office of Management and Budget. This is because the Office of Management and Budget is responsible for assisting the President in preparing the annual budget proposal, evaluating the effectiveness of agency programs and policies, and coordinating the administration's financial management efforts. It serves as a central agency that reviews and analyzes the budget requests from executive agencies before they are submitted to Congress for approval.

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11.

Once the Office of Management and Budget has prepared the federal budget

It is sent to the Treasury for implementation
The President makes revision and submits it to Congress
It is either signed or vetoed
Congress votes within 10 days
It becomes a law

Correct Answer

A. The President makes revision and submits it to Congress

Explanation

After the Office of Management and Budget has prepared the federal budget, it is sent to the Treasury for implementation. However, before it becomes a law, the President has the authority to make revisions to the budget and then submits it to Congress for approval. Congress then has the power to either sign or veto the budget within a period of 10 days. If Congress votes in favor of the budget, it becomes a law.

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12.

Congress's control over federal appropriations is more commonly known as

The power of the purse
Bully pulpit
Oversight
The great pocketbook
Trump ticket

Correct Answer

A. The power of the purse

Explanation

The phrase "the power of the purse" refers to Congress's authority to control government spending and appropriations. This power allows Congress to allocate funds for various programs, projects, and agencies, giving them significant influence over the financial decisions of the federal government. By controlling the purse strings, Congress can shape and prioritize the use of taxpayer money, making it a crucial tool in their legislative power.

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Chapter 14 Quiz Kennedy 2nd Block

Which amendment to the US Constitution permitted the federal income tax?

Quiz Preview

A budget deficit occurs when expenditures exceed

The income tax is generally progressive, meaning that

Which federal agency was created in order to collect the federal income tax?

Tax expenditures are

Tax expenditures tend most to benefit

Which of the following best describes incrementalism?

An example of incremental budgeting is

In the House of Representatives, it is the __________Committee that writes tax codes, subject to the approval of Congress as a whole.

The heads of executive agencies send their budget requests to the

Once the Office of Management and Budget has prepared the federal budget

Congress's control over federal appropriations is more commonly known as