Final Exam- Economics Ch. 14

40 Questions | Total Attempts: 57

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Final Exam- Economics Ch. 14

This is the second part of your final. Make sure your eyes are on your own screen.


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

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