Answer the following statement true (T) or false (F)
1) The major expenditure of local governments is for education.
2) A tax is progressive if the average tax rate rises as income increases.
3) If you pay a $2,000 tax on $10,000 of taxable income and a $4,000 tax on a taxable income of
$16,000, the tax is progressive.
4) The marginal tax rate is the tax rate that applies to additional income.
1) T
2) T
3) T
4) T
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A commercial bank is defined as
A) any institution that accepts deposits. B) a firm that is chartered to accept deposits and make loans. C) the institution that sets regulations for commercial activities. D) a firm that obtains funds by selling shares and then buys U.S. Treasury bills. E) any institution that makes loans.
Pension funds ________
A) acquire access to funds by accepting deposits then using these monies to lend to households and firms B) raise funds by selling commercial paper then lend these funds to consumers C) are a special type of mutual fund D) acquire access to monies through the payment of premiums by employees