Write true or false for the following: a.The government modifies the taxation system sometimes to discourage spending so it can mop up over production in the economy. b.A progressive tax system increases income inequality. c. direct tax is said to be direct tax when the impact and incidence of a tax are on one and the same person

Write true or false for the following: a.The government modifies the taxation system sometimes to discourage spending so it can mop up over production in the economy. b.A progressive tax system increases income inequality. c. direct tax is said to be direct tax when the impact and incidence of a tax are on one and the same person

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 7QR

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3) Are excise taxes, like those on tobacco, gasoline, and alcohol, Progressive, Proportional, or Regressive? Why do you think they are?
QUESTION 21 progressive tax system implies that the proportion of income paid to taxes rises as income increases and falls as income decreases. a. False b. True
1.A progressive tax: A. takes a smaller share of the income of high-income taxpayers than of low-income taxpayers. B. has no deadweight loss. C. takes a larger share of the income of high-income taxpayers than of low-income taxpayers. D. takes the same share of the income of high-income taxpayers as it does of low-income taxpayers. 2.When the government imposes an excise tax, the deadweight loss is caused by: A. be greater than the tax revenue paid to the government. B. C. D. A. B. 3 The incidence of a tax: C. prevention of transactions because of the cost of the tax. D. be less than the tax revenue paid to the government. equal the tax revenue paid to the government. is a measure of the revenue the government receives from it. refers to who writes the check to the government. is a measure of the deadweight loss from the tax. refers to how much of the tax is actually paid by consumers and producers.
3.Define progressive tax.asap
8. Explain why each of the following taxes is progressive or regressive. a. $1 per pack federal excise tax on cigarettes b. The federal individual income tax d. The federal payroll tax.
1. What is the relative importance of taxation to the economy of the country? Give at least three and discuss each clearly. 2. Once a government makes "sin taxes" a significant part of its revenue stream, it has an incentive to keep people smoking and drinking. If everyone quits smoking, the government does not get any cigarette tax revenue. Is it really a good idea to fund public services on the back of citizens' addictions?
Choose the Letter of the Correct Answer. 1. It is an act of laying a tax. A. Theory of tax B. Taxation C. Taxing D. Tax 2. A tax imposed by the government at each stage in the production of goods. A. Excise B. Value –added tax C. Property D. Individual tax 3. A tax imposed for the general purposes of the government to raise revenue for the local area needs. A. National B. Municipal C. Community D. Local 4. It is sanction imposed as a punishment for violation of law or acts deemed injurious. A. Tax B. Penalty C. Fine D. Debt 5. This kind of tax is derived from the individuals, corporate estates, and trusts income. A. Income tax B. Capital gains tax C. Donor Tax D. Estate tax
4. Why do government entities impose taxes and how is the type of taxation chosen (e.g., excise v. income v. sales taxes)?
2. When airfares between Santa Rosa and Los Angeles averages $69, the quantity consumed is 42,500 tickets. One day, an airline tax is levied equal to $10.00 and output falls to 37,000 tickets. Assume that air travelers end up paying 75% of the tax. Total expenditures or sales of air travel will be____. Total revenues generated by airlines will be _____ Total tax revenue generated by the government will be ____ Total taxes paid by air travelers will be ____ Total taxes paid by airlines will be ____ Calculate the price elasticity of demand and & interpret coefficient. Use the general formula, not the mid point formula Calculate the price elasticity of supply and interpret coefficient. Use the general formula, not the mid point formula. How do total sales in the airline market before and after the tax support your answer in (n) and/or (o)?
4. What Factors Determine Who Bears the Burden of Taxation?
Taxation Suppose the federal government requires beer drinkers to pay a $2 tax on each case of beer purchased. (a) Draw a supply-and-demand diagram of the market for beer without the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? (b) Now draw a supply-and-demand diagram for the beer market with the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? Has the quantity of beer sold increased or decreased? (c) Can you identify any government revenues? (d) Is there any inefficiency, and if so, can you define it and label it on the graph? (e) If the producer has an inelastic supply curve, which market participant has the bigger tax burden? Explain.
Taxation Suppose the federal government requires beer drinkers to pay a $2 tax on each case of beer purchased. (a) Draw a supply-and-demand diagram of the market for beer without the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? (b) Now draw a supply-and-demand diagram for the beer market with the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? Has the quantity of beer sold increased or decreased?