Final Exam- Economics Ch. 14

40 Questions | By Historyperryhs | Updated: Mar 21, 2022 | Attempts: 100

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Questions and Answers

1.

A tax as a percentage of income increases as income increases
- A.
  
  Regressive taxation
- B.
  
  Progressive taxation
- C.
  
  Proportional taxation
- D.
  
  Increasing marginal tax rate
2.

If a tax structure is progressive and we know that Tom pays $1,000 on his $10,000 income, then Alicia, who earns $30,000 must pay
- A.
  
  More than $3,000
- B.
  
  Exactly $3,000
- C.
  
  Less than $3,000
- D.
  
  More than $3,500
3.

Which of the following is not an entitlement program?
- A.
  
  Homeland security
- B.
  
  Unemployment insurance
- C.
  
  Medicare
- D.
  
  Social Security
4.

Which of the following best describes the state budgets that pays for major infrastructure investments such as new roads and bridges
- A.
  
  National budget
- B.
  
  Capital budget
- C.
  
  Operating budget
- D.
  
  Stock budget
5.

Which of the following is not a source of revenue for state or local governments?
- A.
  
  Tarrifs on imported goods
- B.
  
  Income taxes
- C.
  
  Property taxes
- D.
  
  Sales taxes
6.

An ability to pay tax also is likely to be
- A.
  
  Regressive
- B.
  
  Progressive
- C.
  
  Proportional
- D.
  
  Negatory
7.

What is Fiscal policy?
- A.
  
  The use of taxation to redistribute income accross the United States
- B.
  
  Taxes deducted from paychecks to support Social Security and Medicare
- C.
  
  A plan for government spending and revenue for a specified period, usually a year
- D.
  
  The use of government spending and taxation to influence the economy
8.

The State of Iowa constitution forbids the operating budget from going into a budget deficit
- A.
  
  True
- B.
  
  False
9.

Which of the following is the best example of the benefits received tax principle
- A.
  
  The toll that is paid to cross a bridge
- B.
  
  Property taxes paid on homes and land
- C.
  
  The excise tax on cigarettes
- D.
  
  A tariff on imported automobiles
10.

Which President served when the U.S had the smallest budget deficit in the last 30 years?
- A.
  
  George W. Bush II
- B.
  
  Ronald Reagan
- C.
  
  Jimmy Carter
- D.
  
  Bill Clinton
11.

Which of the following is a tax deduction that individuals can claim on their tax returns?
- A.
  
  Interest on mortgages
- B.
  
  Donations to charity
- C.
  
  Interest on student loans
- D.
  
  All options
12.

Taxes that fall more heavily on people who earn larger incomes represent the ability to pay principle of taxation
- A.
  
  True
- B.
  
  False
13.

Taxes that fall more heavily on people who earn smaller incomes are called?
- A.
  
  Excise Taxes
- B.
  
  Regressive Taxes
- C.
  
  Proportional Taxes
- D.
  
  Progressive Taxes
14.

Which of the following programs falls under the mandatory spending of the federal government
- A.
  
  Social Security
- B.
  
  Medicare
- C.
  
  Medicaid
- D.
  
  Veterans benefits
- E.
  
  All options
15.

Why is Social Security spending not shown in this graph?
- A.
  
  Because their is no government spending on social security
- B.
  
  Because social security is a mandatory spending program, not discretionary.
- C.
  
  Because the graph shows spending at state level and not the federal level
- D.
  
  Because discretionary spending is a a state level budget not a federal level budget item.
16.

What is the largest discretionary spending program?
- A.
  
  Social security
- B.
  
  Defense
- C.
  
  Education
- D.
  
  Environment
17.

Read the hand out and answer the following question: What form of revenue did the U.S. government rely on in the early stages of United States history?
- A.
  
  Income tax
- B.
  
  Taxes on imports
- C.
  
  Corporate taxes
- D.
  
  Gift taxes
18.

Read the hand out and answer the following question: When did the United States begin to impose the income tax for the FIRST time?
- A.
  
  1890
- B.
  
  1872
- C.
  
  1913
- D.
  
  During the Civil War
19.

According to the fiscal cliff compromise, who does the government consider to be wealthy?
- A.
  
  Individuals who own mansions and luxury vehicles.
- B.
  
  Individuals who earn more than $1,000,000
- C.
  
  Individuals who earn more than $250,000
- D.
  
  Individuals who earn more than $400,000
20.

What would have happened on January 2nd if the fiscal cliff compromise was not reached?
- A.
  
  Taxes would have gone up on the wealthy only.
- B.
  
  Spending cuts would have been made to major government programs.
- C.
  
  Spending increases would have been made to government programs and taxes would have gone up on all taxpayers.
- D.
  
  Taxes would have gone up on everybody and spending cuts would have been made to major government programs.
21.

When economists analyze taxation, which of the followin is not a key characteristic of what they would consider a "good" tax?
- A.
  
  Equity
- B.
  
  Efficiency
- C.
  
  Progressiveness
- D.
  
  Simplicity
22.

What is the main tax base for the City of Perry and Dallas County?
- A.
  
  Income taxes
- B.
  
  Sales taxes
- C.
  
  Property taxes
- D.
  
  Estate taxes
23.

The Internal Revenue Service (IRS) is the government's agency in charge of tax collection. What tax is the cartoonist referring to in this cartoon?
- A.
  
  Gift tax
- B.
  
  Income tax
- C.
  
  Social Security
- D.
  
  Medicare
- E.
  
  Medicaid
- F.
  
  Estate tax
- G.
  
  Sales tax
- H.
  
  Hospital tax
- I.
  
  Mortgage tax
24.

Which of the following is NOT an entitlement program?
- A.
  
  Social Security
- B.
  
  Medicaid
- C.
  
  Unemployment benefits
- D.
  
  Military defense
25.

Under the current social security system, both the employer and the employee contribute and the worker's social security account.
- A.
  
  True
- B.
  
  False