ECO 450 Week 11 Final Exam Part 2

ECO 450 Week 11 Final Exam Part 2

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Question 1

Most empirical research indicates that the market supply curve of labor hours by prime-age males is:

Answer

Question 2

The higher the compensated elasticity of supply of savings,

Answer

Question 3

If the return to savings, r, is subject to taxation at rate t, then in equilibrium a saver’s marginal rate of time preference will equal:

Answer

Question 4

The Haig-Simons definition of income:

Answer

Question 5

Comprehensive income:

Answer

Question 6

Which of the following is the result of The Economic Growth and Tax Relief Reconciliation Act enacted in 2001?

Answer

Question 7

The reduction in marginal tax rates will:

Answer

Question 8

Which of the following is true for the federal income tax in the United States?

Answer

Question 9

The excess burden of tax preferences:

Answer

Question 10

Tax expenditures are:

Answer

Question 11

Accelerated depreciation allows corporations to:

Answer

Question 12

In the long run a corporate income tax that initially reduces the return to investment in the corpo­rate sector will also:

Answer

Question 13

If corporations maximize profits, the short-run incidence of a tax on its profits will be borne by:

Answer

Question 14

If an all-equity firm has after-tax income of $100,000 based on a 34% income tax, what is the after-tax income of an equivalent firm that pays $15,000 in interest that is tax deductible?

Answer

Question 15

If the supply of savings is not perfectly elastic, the corporate income tax is likely to:

Answer

Question 16

Assuming that a person never receives any cash gifts or bequests, a tax on comprehensive con­sumption is equivalent to a(n):

Answer

Question 17

In most states, the retail sales tax can be regarded as equivalent to a:

Answer

Question 18

Consumption-in-kind:

Answer

Question 19

A consumption-type, value-added tax:

Answer

Question 20

The differential incidence of substituting a tax on comprehensive consumption for a tax on compre­hensive income is likely to be:

Answer

Question 21

If a tax on real estate results in a decrease in the supply of housing, the tax will be:

Answer

Question 22

A comprehensive wealth tax will:

Answer

Question 23

If the annual amount of savings is $10 billion, what is the effect of a wealth tax assuming supply is responsive?

Answer

Question 24

If the annual amount of savings is $10 billion, what is the effect of a wealth tax assuming supply is perfectly inelastic?

Answer

Question 25

A comprehensive wealth tax base includes:

Answer

Question 26

What is generally the best measure of fiscal capacity for local governments?

Answer

Question 27

In general, local tax bases tend to be:

Answer

Question 28

Under a federal system of government,

Answer

Question 29

A federal highway grant will provide funds for roads supplied by state and local governments if these governments pay 50 percent of the cost of the roads. This grant is an example of:

Answer

Question 30

A grant received by a local government will:

Answer

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ECO 450 Week 11 Final Exam Part 1

ECO 450 Week 11 Final Exam Part 1

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Question 1

3 out of 3 points

A worker earns $2,000 per month before taxes. He pays $140 per month payroll tax on those wages. In addition, the income taxes on those wages are $360 per month. On retirement, the worker receives a Social Security pension of $750 per month. Which of the following statements is true?

Answer

Question 2

3 out of 3 points

The Social Security Act was implemented in the United States in:

Answer

Question 3

3 out of 3 points

The gross replacement rate:

Answer

Question 4

Social Security tax rates can be reduced if:

Answer

Question 5

The Social Security retirement system:

Answer

Question 6

The induced-retirement effect of the Social Security pension system induces workers to:

Answer

Question 7

Which of the following is true about the Medicare program in the United States?

Answer

Question 8

The percent of total health care costs in the United States paid for by governments is approximately:

Answer

Question 9

The government program that provides the health insurance to the poor in the United States is called:

Answer

Question 10

Under national health insurance as operated in Great Britain,

Answer

Question 11

Most of the medical bills of Americans in the United States are paid by:

Answer

Question 12

What is the moral hazard associated with third party payment for health services?

Answer

Question 13

A proportional income tax has an average tax rate that:

Answer

Question 14

A tax on real estate is a:

Answer

Question 15

If the average tax rate under a progressive tax rate structure is 35%, a possible marginal tax rate is:

Answer

Question 16

3 out of 3 points

A 5-percent retail sales tax on all consumer purchases in a state is imposed. The sales tax is:

Answer

Question 17

Taxes:

Answer

Question 18

Which of the following countries has the highest average tax rate relative to GDP?

Answer

Question 19

The efficiency-loss ratio relative to tax is:

Answer

Question 20

If a lump-sum tax is imposed, the slope of the new budget line relative to the budget line prior to the tax:

Answer

Question 21

3 out of 3 points

Viewed from origin a price distorting tax creates a new budget line with a ______ slope relative to the budget line without the tax.

Answer

Question 22

A $0.30 per unit tax is imposed on a good that reduces the quantity supplied and demanded by 1000 units. What is the deadweight loss (ignore price elasticities)?

Answer

Question 23

Other things being equal, the more inelastic the demand for a taxed good,

Answer

Question 24

The supply of new cars is perfectly elastic. A $400 per car tax is levied on buyers. As a result of the tax,

Answer

Question 25

3 out of 3 points

The federal government, its agencies, and the Federal Reserve System:

Answer

Question 26

The National Income and Product Accounts budget balance reflects:

Answer

Question 27

The total dollar value of the federal debt outstanding is:

Answer

Question 28

The debt of state and local governments is mostly:

Answer

Question 29

If the federal government runs a surplus consistently, then which of the following is likely to occur?

Answer

Question 30

An increase in government borrowing has no effect on the willingness of citizens to save or on the demand for credit. Increased borrowing to cover deficits will therefore:

Answer

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ECO 450 Week 10 Quiz

ECO 450 Week 10 Quiz

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Question 1

According to the Harberger model of the incidence of the corporate income tax, the tax:

Question 2

Under the corporation income tax in the United States,

Question 3

Accelerated depreciation allows corporations to:

Question 4

If corporations maximize profits, the short-run incidence of a tax on its profits will be borne by:

Question 5

The tax base for the corporate income tax in the United States is:

Question 6

The double taxation of dividends under U.S. tax code means:

Question 7

If an all-equity firm has after-tax income of $100,000 based on a 34% income tax, what is the after-tax income of an equivalent firm that pays $15,000 in interest that is tax deductible?

Question 8

If interest on corporate debt is tax deductible, a firm’s return on equity increases because:

Question 9

Assuming that the supply of savings is perfectly inelastic, the corporate income tax prevents the attainment of efficiency by:

Question 10

If the supply of savings is not perfectly elastic, the corporate income tax is likely to:

Question 11

In the long run a corporate income tax that initially reduces the return to investment in the corpo­rate sector will also:

Question 12

If corporations maximize profit, a corporate income tax:

Question 13

Assuming that corporations maximize profits and investors seek to maximize the return to their investments, the long-run impact of a corporate income tax is to:

Question 14

The effective tax rate is:

Question 15

Which of the following is true about the economic effects of the corporate income tax?

Question 16

In most states, the retail sales tax can be regarded as equivalent to a:

Question 17

The differential incidence of substituting a tax on comprehensive consumption for a tax on compre­hensive income is likely to be:

Question 18

Suppose two individuals earn the same salary each year over their lifetimes. One individual saves 25 percent of his income each year, while the other saves nothing. Over their lifetimes under a comprehensive income tax,

Question 19

The value-added tax used in the European Union:

Question 20

Consumption-in-kind:

Question 21

As administered in most states in the United States, the retail sales tax:

Question 22

Comprehensive consumption is:

Question 23

A flat-rate tax on comprehensive consumption:

Question 24

Which of the following taxes is likely to be most favorable for capital accumulation?

Question 25

The invoice method of collecting the value-added tax:

Question 26

Which of the following statements about taxes on consumption are true?

Question 27

A consumption-type, value-added tax:

Question 28

An adult’s life cycle is considered to begin:

Question 29

Assuming that a person never receives any cash gifts or bequests, a tax on comprehensive con­sumption is equivalent to a(n):

Question 30

A tax on comprehensive consumption

ECO 450 Week 9 Quiz

ECO 450 Week 9 Quiz

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Question 1

A tax on interest income:

Answer

Question 2

Which of the following is true about comprehensive income?

Answer

Question 3

If the market supply curve of savings is upward sloping, a tax on interest income will:

Answer

Question 4

2 out of 2 points

Most empirical research indicates that the market supply curve of labor hours by prime-age males is:

Answer

Question 5

2 out of 2 points

The Haig-Simons definition of income:

Answer

Question 6

Using a regular labor supply curve instead of a compensated supply curve to calculate the excess burden of a tax on labor income will:

Answer

Question 7

If the return to savings, r, is subject to taxation at rate t, then in equilibrium a saver’s marginal rate of time preference will equal:

Answer

Question 8

The compensated labor supply curve:

Answer

Question 9

A flat-rate tax on labor income will:

Answer

Question 10

Comprehensive income:

Answer

Question 11

2 out of 2 points

Income from labor services (wages) account for what percentage of gross income in the U.S.?

Answer

Question 12

2 out of 2 points

Comprehensive income:

Answer

Question 13

2 out of 2 points

If the supply of labor is perfectly inelastic, then the incidence of a payroll tax levied entirely on employers will be:

Answer

Question 14

The higher the compensated elasticity of supply of savings,

Answer

Question 15

Which of the following will increase a person’s comprehensive income?

Answer

Question 16

A taxpayer is in a 33-percent tax bracket and itemizes deductions. He obtains a mortgage from a bank at 9-percent interest. The actual rate of interest he pays is:

Answer

Question 17

2 out of 2 points

Tax preferences:

Answer

Question 18

If the excess burden from tax is $10 million, lowering marginal tax rates should make the excess burden:

Answer

Question 19

Tax expenditures are:

Answer

Question 20

2 out of 2 points

Adjusted gross income, as defined by the United States Tax Code,

Answer

Question 21

2 out of 2 points

“Bracket creep” is no longer a problem in the United States because:

Answer

Question 22

2 out of 2 points

The excess burden of tax preferences:

Answer

Question 23

Which of the following is true for the federal income tax in the United States?

Answer

Question 24

Removing savings from the tax base of the personal income tax is likely to:

Answer

Question 25

Because of the Earned Income Tax Credit, the effective tax rate for the lowest-income taxpayers in the United States is:

Answer

Question 26

Currently, the tax treatment of capital gains in the United States is such that:

Answer

Question 27

The reduction in marginal tax rates will:

Answer

Question 28

2 out of 2 points

As of 2009, the highest marginal tax rate is:

Answer

Question 29

The exclusion of interest of state and local bonds from taxation by the federal government:

Answer

Question 30

Under the federal personal income tax rules prevailing as of 2009,

Answer

ECO 450 Week 8 Quiz

ECO 450 Week 8 Quiz

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Question 1

Housing construction is generally believed to be an industry of constant costs. In the long run, which of the following is true if a $10 per square foot tax on housing construction is collected directly
from builders?

Question 2

Which of the following is true about a lump-sum tax?

Question 3

The demand for medical care is very inelastic. If a 10-percent tax is levied on the sale of medical services and is collected from medical-care providers, then:

Question 4

2 out of 2 points

Currently, a 10-cent per gallon tax is levied on gasoline consumption. The tax is increased to 20 cents per gallon. The excess burden of the tax will:

Answer

Question 5

Suppose an economy is comprised of only two markets: one for food and the other for housing. A tax on food used to finance transfer payments is likely to:

Answer

Question 6

A $0.30 per unit tax is imposed on a good that reduces the quantity supplied and demanded by 1000 units. What is the deadweight loss (ignore price elasticities)?

Answer

Question 7

The efficiency-loss ratio relative to tax is:

Answer

Question 8

2 out of 2 points

The current price of compact discs, which are traded in perfectly competitive markets, is $10. A $1 per unit tax is levied on the discs. Annual record sales decline from five million to four million as a result of the tax. Assuming that the income effect of the tax-induced price change is negligible, the excess burden of the tax will be:

Answer

Question 9

2 out of 2 points

If a lump-sum tax is imposed, the slope of the new budget line relative to the budget line prior to the tax:

Answer

Question 10

If the price elasticity of supply of labor is equal to 0.5 and the price elasticity of demand for labor is –2, then which of the following is likely to result from a tax on labor earnings?

Answer

Question 11

A lump-sum tax:

Answer

Question 12

2 out of 2 points

Other things being equal, the more inelastic the demand for a taxed good,

Answer

Question 13

2 out of 2 points

Differential tax incidence measures the effect:

Answer

Question 14

2 out of 2 points

Most studies of tax incidence assume that taxes on labor income and other input services are borne entirely by the workers and other input owners that supply the services. This implies that the:

Answer

Question 15

Viewed from origin a price distorting tax creates a new budget line with a ______ slope relative to the budget line without the tax.

Answer

Question 16

2 out of 2 points

Which of the following can contribute to a decrease in national saving?

Answer

Question 17

The total dollar value of the federal debt outstanding is:

Answer

Question 18

A government’s internal debt is:

Answer

Question 19

Other things being equal, a government budget surplus:

Answer

Question 20

The largest portion of the net federal debt outstanding is owed to:

Answer

Question 21

2 out of 2 points

Which of the following is true about the federal government budget balance in the United States?

Answer

Question 22

The federal budget has been in deficit:

Answer

Question 23

As a result of government borrowing to cover deficits, citizens increase the supply of savings to provide themselves with funds to pay anticipated increases in future taxes. Then it follows that increased government borrowing will:

Answer

Question 24

The high employment deficit is estimated at $100 billion. Assuming that the economy is operating below full employment and that it will not overheat during the year,

Answer

Question 25

High-employment deficit or surplus is:

Answer

Question 26

The National Income and Product Accounts budget balance reflects:

Answer

Question 27

0 out of 2 points

A bond that is backed by the tolls collected from a bridge to be constructed from the proceeds of the bond is an example of:

Answer

Question 28

2 out of 2 points

The debt of state and local governments is mostly:

Answer

Question 29

2 out of 2 points

Evidence of “crowding out” in the market for loanable funds at a rate of 8% could be:

Answer

Question 30

2 out of 2 points

The federal government, its agencies, and the Federal Reserve System:

Answer

ECO 450 Week 7 Quiz

ECO 450 Week 7 Quiz

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Review Test Submission: Quiz 5

Course Public Finance

Test

Quiz 5

This quiz consist of 15 multiple choice questions and covers the material in Chapter 10. Be sure you are in Chapter 10 when you take the quiz.

Question 1

.

According to the benefit principle,

Question 2

If the marginal tax rate is 20% under a proportional tax rate structure, the average tax rate:

Question 3

.

If the average tax rate under a progressive tax rate structure is 35%, a possible marginal tax rate is:

Question 4

A payroll tax taxes a worker’s wages at 14 percent until the worker earns $60,000 per year. All labor earnings in excess of $60,000 are not subject to tax. The tax rate structure of the payroll tax is therefore:

Question 5

The marginal tax rate will eventually exceed the average tax rate for

Question 6

Which of the following countries has the highest average tax rate relative to GDP?

Question 7

Tax avoidance is:

Question 8

Marginal tax rates were reduced in 2001. Other things being equal, this is likely to:

Question 9

An excise tax is a:

Question 10

.

A tax on the value of real estate holdings is a:

Question 11

.

A 5-percent retail sales tax on all consumer purchases in a state is imposed. The sales tax is:

.

Question 12

A proportional income tax has an average tax rate that:

Question 13

.

The tax base of a payroll tax is:

Question 14

.

Question 15

.

A bridge becomes congested after 100 vehicles per hour use it on any day. To achieve efficiency, a toll