Question

1. which type of tax is levied at the same percentage for people at all income levels?

a. regressive
c. progressive
b. inelastic
d. proportional

1. which of the following statements is supported by this graph?

a. the higher the income, the lower the share of income paid in sales and excise taxes.
b. the lower the income, the greater the amount of money paid in sales and excise taxes.
c. the higher the income, the lower the rate at which sales and excise taxes are charged.
d. the lower the income, the higher the rate at which sales and excise taxes are charged.

1. what is another name for the system described below?

federal income tax is collected on a “pay - as - you - earn” system. this means that individuals usually pay most of their income tax throughout the calendar year as they earn income.
a. withholding
c. incentive taxation
b. mandatory spending
d. progressive taxation

1. this passage could be referring to the impact of which of the following?

in works of historical fiction, and perhaps in real life too, monarchs and rich landowners would gesture toward their vast landholdings and say to their children, “one day, all this will be yours.” but in the united states today, they would have to say, “one day, a percentage of this will be yours.”
a. the individual income tax
c. the property tax
b. the corporate income tax
d. the estate tax

Explanation:

• Question 21:
• A proportional tax is levied at the same percentage for people at all income levels. A regressive tax takes a larger percentage from low - income earners. A progressive tax takes a larger percentage from high - income earners. “Inelastic” is not a type of tax structure in this context.
• Question 22:
• Looking at the bar graph titled “Regressive Taxation: Sales and Excise Taxes”, as family income increases (from \(\$10,700\) to \(\$1,297,700\)), the percent of income paid in sales and excise taxes decreases.
• Question 23:
• The “pay - as - you - earn” system for federal income tax is known as withholding. Mandatory spending is a part of the government budget. Incentive taxation is a tax policy to encourage or discourage certain behaviors. Progressive taxation is about the rate structure (higher rates for higher incomes), not the collection method.
• Question 24:
• The passage is about the transfer of property (landholdings) from one generation to the next with a portion going to the government. The estate tax is levied on the transfer of property after a person's death. The individual income tax is on earned income. The corporate income tax is on business profits. The property tax is an annual tax on property ownership, not specifically about the transfer of property at death.

Answer:

1. D. proportional
2. A. The higher the income, the lower the share of income paid in sales and excise taxes.
3. A. withholding
4. D. the estate tax