Answer the following statement true (T) or false (F)
1) About two-thirds of all federal spending is for national defense.
2) A progressive tax takes relatively more from the rich than it does from the poor.
3) The benefits-received principle of taxation is used to support corporate and personal income taxes.
4) Sales taxes are proportional in relation to income because the same tax rate applies regardless of the size of a purchase.
Answer:
1. False.
2. True.
3. False.
4. False.
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Two taxes that have consumption as a tax base are ____ taxes and _____ taxes
a. income; general sales b. general sales; valued-added c. excise; income d. estate; retail sales
Exhibit 10-3 Aggregate supply and demand curves
In Exhibit 10-3, the change in equilibrium from E1 to E2 represents:
A. deflation. B. demand-pull inflation. C. price-push inflation. D. cost-push inflation.