Fiscal Policy: Taxes Answers
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1
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Which statements best describe sales tax? Check all that apply.
A
Sales tax does not affect low-income groups.B
Sales tax is an indirect tax levied on goods and certain services.C
Sales tax is a type of regressive taxation.D
Sales tax is a direct tax paid by consumers to the government.E
Sales tax affects high-income groups.2
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Which of these is most likely the US government’s aim in taxing imported goods?
A
to protect domestic businessesB
to decrease international tradeC
to end reliance on foreign goodsD
to make US markets less desirable3
High government expenditures can lead to a bigger
A
revenue.B
stimulus.C
deficit.D
surplus.4
How is an excise tax different from a sales tax?
A
An excise tax is not deductible.A
An excise tax applies to specific products.A
An excise tax applies only to imported goods.A
An excise tax is an indirect tax.5
This graph shows US government revenue and expenditures between 1980 and 2010.
T
The government spends less than it receives year over year.T
The government should produce more money to cover spending.T
The government on average spends more than it collects.T
The government needs to lower taxes to cover spending.6
What gives the US government the power to collect taxes?
A
the ConstitutionB
laws passed by CongressC
an executive orderD
common law7
best
r
regressive taxi
indirect taxd
direct taxp
proportional tax8
A sales tax is a type of
p
progressive tax.i
indirect tax.p
proportional tax.d
direct tax.9
Governments collect taxes to ensure that
t
there is sufficient money to fund private businesses.c
citizens contribute to meeting society's needs.p
politicians get paid in a timely manner.a
a government program exists for every need that arises.10
proportionallyprogressivelyregressively
A
proportionallyB
progressivelyC
regressivelyDid you find these answers helpful?
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