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.Management Sciences
Category: Taxation
Since the supply of undeveloped land is relatively inelastic a tax on undeveloped land would generate ?
A. a small deadweight loss and the burden of the tax would fall on the renter
B. a large deadweight loss and the burden of the tax would fall on the landlora
C. a large deadweight loss and the burden of the tax would fall on the renter.
D. a small deadweight loss and the burden of the tax would fall on the landlord
The appropriate tax rate to consider gauging how much the tax system distorts incentives and decision making is the ?
A. Proportional tax rate
B. average tax rate
C. marginal tax rate
D. vertical tax rate
E. horizontal tax rate
Which of the following is true with regard to a tax on labor income? Taxes on labor income tend to encourage ?
A. the unscrupulous to enter the underground economy
B. the elderly to retire early.
C. all the things described in these answers.
D. second earners to stay home.
E. workers to work fewer hours
A tax system is regarded as horizontally equitable if ?
A. all taxpayers pay the same amount of tax
B. taxes on all goods are levied at the same rate
C. taxes are as low as possible
D. the system comprises only lump sum taxes
E. taxpayers with similar abilities to pay taxes pay the same amount
A tax for which high income taxpayers pay a smaller fraction of their income than do low income taxpayers is known as ?
A. a proportional tax
B. a regressive tax
C. an equitable tax
D. a progressive tax
Which of the following would likely cause the greatest deadweight loss ?
A. a tax on salt
B. a tax on cigarettes
C. a tax on petrol
D. a tax on cruise line tickets
The average tax rate is ?
A. total taxes paid divided by total income
B. the extra taxes paid on an additional dollar or income.
C. the taxes paid by the marginal worker
D. total income divided by total taxes paid
The marginal tax rate is ?
A. the taxes paid by the marginal worker
B. total income divided by total taxes paid
C. the extra taxes paid on an additional unit of income
D. total taxes paid divided by total income
The ability-to-pay principle of taxation suggests that if a tax system is to be vertically equitable it should be ?
A. efficient
B. progressive
C. regressive
D. proportional
The appropriate tax rate to consider judging the vertical equity of a tax system is the ?
A. marginal tax rate
B. average tax rate
C. horizontal tax rate
D. proportional tax rate
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