Deck 11: Finance and Fiscal Policy

Question 1

What is a problem with denying CHIP benefits to children?

A) It involves a reduction of federal money to the state.
B) It results in an increase in taxes for the wealthy.
C) It adds to the state's debt.
D) It results in a reduction in hospital taxes for the needy.
E) It causes businesses to pay higher franchise fees.

Answer 1

A

Question 2

Which kind of tax relies more heavily on revenues from higher incomes?

A) Flat tax
B) Progressive tax
C) Regressive tax
D) Nominal tax
E) Value-added tax

Answer 2

B

Question 3

Which of the following classes of corporations has the least business tax burden?

A) Oil companies
B) Banking companies
C) Insurance companies
D) Public utility companies
E) Gas companies

Answer 3

B

Question 4

Which tactic does Texas often use to balance the budget?

A) Raising the state income tax
B) Increasing fees on various businesses
C) Reducing funding for high-cost items such as Medicaid
D) Borrowing from the Rainy Day Fund
E) Asking the federal government for a loan

Question 5

The "Robin Hood" plan is an attempt to equalize funding among which type of educational institution?

A) Charter schools
B) Public schools
C) Private universities
D) Public universities
E) Community colleges

Question 6

What is the name of the fund that measures the state's fiscal health?

A) Selective sales tax fund
B) Rainy Day Fund
C) Surplus revenue fund
D) Overall lottery fund
E) General Revenue Fund

Question 7

What amount of state funding for public schools is provided by the Foundation School Fund?

A) Less than 10 percent
B) Almost 25 percent
C) Just under 50 percent
D) About 60 percent
E) More than 70 percent

Question 8

In the 2018-2019 biennial budget,approximately what percentage of state expenditures went to Health and Human Services funding?

A) 15-20 percent
B) 25-30 percent
C) 35-40 percent
D) 45-50 percent
E) 60-70 percent

Question 9

Which statement best characterizes the status of Texas highways?

A) Many highways are in disrepair,but there are adequate funds for their repair.
B) Large sums of money are currently needed for highway repair and maintenance.
C) It probably makes more sense to build new highways than to repair old ones.
D) The state has more than adequately maintained its highways since 1984.
E) The state has the most modern and state-of-the-art highway system in the nation.

Question 10

What is the state's largest financial aid program?

A) Teach for Texas Fund
B) Texas Tomorrow Fund
C) Texas Tuition Equalization Grant Program
D) Texas Grants Program (Toward Excellence,Access,and Success)
E) Texas Teachers' Tuition Fund

Question 11

What must the Texas legislature do as a result of the "pay-as-you-go" system?

A) Pay its bills on time
B) Pass a surplus budget
C) Borrow to pay its bills
D) Not pass a deficit budget
E) Annually increase funding for poverty programs

Question 12

So-called "sin taxes" are levies placed on what types of commodities or activities?

A) Alcohol,mixed drinks,and tobacco
B) Food,clothing,and drinks
C) Hotel and restaurant revenues
D) Hunting and fishing activities
E) Sporting activities

Question 13

Which group of Texans pays the most in taxes in proportion to their income?

A) Middle class
B) Wealthiest 20 percent
C) Purchasers of luxury cars
D) Poorest 20 percent
E) Purchasers of upscale homes

Question 14

Which method of taxation places a greater burden on lower incomes and a lighter burden on higher incomes?

A) Flat taxation
B) Progressive taxation
C) Indexed taxation
D) Nominal taxation
E) Regressive taxation

Question 15

Which of these must give approval in order for Texas to increase its bond debt?

A) Texas legislature
B) Texas governor
C) Voters of Texas
D) Comptroller of public accounts
E) The Legislative Budget Board

Question 16

Where does Texas rank among the states in terms of the tax burden on its citizens?

A) At the very top
B) About twentieth
C) About thirty-fifth
D) Near the bottom
E) In the top ten

Question 17

Which area of the state is home to the newest regional comprehensive university?

A) The Rio Grande Valley
B) The Houston metropolitan area
C) The Texas Panhandle
D) The El Paso metropolitan area
E) North Texas

Question 18

Regarding fiscal policy,what does the Texas Constitution require?

A) The legislature must draft and pass an annual budget.
B) The state's expenditures should be within 10 percent of projected state revenues.
C) Welfare spending must be limited to no more than 1 percent of total state spending in any fiscal year.
D) The governor must certify that state spending is in balance with state revenues.
E) A state income tax must be applied if spending exceeds the amount budgeted.

Question 19

What is the name of a state tax levied on a natural resource taken from the earth?

A) Franchise tax
B) Resources tax
C) Special sales tax
D) Corporate user tax
E) Severance tax

Question 20

When does the fiscal biennium in Texas begin?

A) June 30 of odd-numbered years
B) January 1 of even-numbered years
C) October 1 of even-numbered years
D) September 1 of odd-numbered years
E) December 31 of odd-numbered years

Question 21

Which of the following determines if state agencies have spent public funds in accordance with law?

A) The State Auditor's Office
B) The comptroller of public accounts
C) The Legislative Budget Board
D) The secretary of state
E) The House Appropriations Committee

Question 22

What must happen before the governor can sign a biennial budget that the legislature has approved?

A) The attorney general issues an opinion that all expenditures are permitted by the Texas Constitution.
B) The lieutenant governor and the Speaker of the House vote to approve it.
C) The Legislative Budget Board certifies that proper procedures were followed in approving the budget.
D) The comptroller certifies the state will collect sufficient revenue to cover the expenditures.
E) Texas voters must approve the budget in a special election.

Question 23

What is another name for the state's Economic Stabilization Fund?

A) General obligation fund
B) "Pork barrel" fund
C) Rainy Day Fund
D) General Revenue Fund
E) Dedicated fund

Question 24

Which type of tax did the state of Texas mandate on the revenue of many businesses in 2006?

A) State income tax
B) General sales tax
C) Franchise tax
D) Severance tax
E) Property tax

Question 25

What are grants-in-aid?

A) Gifts of money from one government to another
B) State matching of federal funds
C) Money from private foundations to the state
D) Federal money given to states based on income tax ratios
E) Money paid to the state by dog- and horse-racing tracks

Question 26

What is probably the most influential budgeting organization in Texas?

A) The treasurer's office
B) The Legislative Budget Board
C) The State Auditor's Office
D) The Governor's Office of Budget and Policy
E) The state comptroller's office

Question 27

Paul won $5 million in the Texas Lottery but failed to claim his prize within 180 days after the drawing.What will happen to his winnings?

A) They will be used to fund welfare programs.
B) They will be used to fund public education.
C) They will be used to fund gambling addiction treatment programs.
D) They will be used to fund hospitals for indigent care.
E) They will be used to fund workers' compensation insurance.

Question 28

Which factor will increase the state's outcomes-based funding to a community college?

A) An increase in enrollment
B) A decrease in tuition rates
C) An increase in the number of low-income students enrolled
D) An increase in the number of students successfully completing courses
E) An increase in minority hiring

Question 29

Which of these is responsible for overseeing the investment of state funds?

A) State comptroller
B) State auditor
C) State treasurer
D) The Legislative Budget Board
E) The Economic Stabilization Board

Question 30

Most Texans have indicated in numerous polls that they prefer which type of taxation?

A) Regressive
B) Progressive
C) Flat
D) Neutral
E) Indexed

Question 31

As a result of a lawsuit filed by the state of Texas over tobacco-related illnesses,how much must the American tobacco industry pay the state?

A) $25 million in damages
B) $100 million in damages
C) $500 million in damages
D) $6 billion in damages
E) $18 billion in damages

Question 32

Which of the following will have the greatest impact on the state's water supply in the coming years?

A) The loss of high-tech jobs throughout the state
B) An increase in farm foreclosures
C) More stringent water pollution regulations
D) Fertilizer run-off into the water supply
E) The expected increase in population

Question 33

How does a budget passed by the Texas legislature differ from the federal budget?

A) It must pass both the House and Senate.
B) It requires a four-fifths vote to override a veto.
C) It authorizes spending for a two-year period.
D) It must go to the chief executive for approval.
E) It must include spending for public assistance programs.

Question 34

Which task does the comptroller's office oversee?

A) Preparing the state's budget
B) Issuing checks to pay state obligations
C) Appropriating lottery funds
D) Selling general obligation bonds
E) Taking reservations for football tailgating on state property

Question 35

Compared to the rest of the nation,where does Texas rank concerning the number of children without health insurance coverage in Texas?

A) Among the lowest
B) About average
C) The highest
D) Slightly above average
E) The very lowest

Question 36

In Texas,which of these provides budget makers with projected revenue levels?

A) State Auditor's Office
B) State Comptroller of Public Accounts
C) General Accounting Office
D) Governor's Office of Budget and Policy
E) Senate Finance Committee

Question 37

Which of these types of policy concerns government decisions regarding revenues,expenditures,and borrowing?

A) Monetary policy
B) Foreign policy
C) Banking policy
D) Fiscal policy
E) Economic policy

Question 38

The state of Texas provides unemployment insurance under monies collected from which source?

A) Selective sales taxes
B) Severance taxes
C) Payroll taxes
D) General obligation bonds
E) Franchise fees

Question 39

Which of the following is true of Texas's dual budgeting system?

A) Revenues and expenditures are equal.
B) The House and Senate must pass the budget.
C) The comptroller and treasurer authorize spending.
D) The governor and the legislature draw up budget proposals.
E) The governor must prepare two separate budgets but only one is approved.

Question 40

Texas state government depends heavily on which type of tax to finance services?

A) State income tax
B) Sales tax
C) Franchise tax
D) Severance tax
E) Estate tax

Question 41

What legal mechanisms are in place to keep the Texas budget balanced?

Question 42

What is the name for a bond whose repayment is guaranteed by the full faith and credit of the state?

A) Revenue bond
B) General obligation bond
C) Special assessment bond
D) Limited obligation bond
E) High-yield bond

Question 43

Explain the role of the comptroller of public accounts.

Question 44

Summarize the system of higher education funding at Texas colleges and universities,and explain how funding for community colleges differs from that of four-year institutions.Identify some of the controversies surrounding higher education funding.

Question 45

Explain the state's role in helping students afford a higher education.

Question 46

According to the Texas Transportation Commission,what is the newest means of financing Texas highways?

A) The use of money from the sale of bonds
B) The use of money collected from tolls
C) Increased gas taxes
D) A state income tax
E) An increase in the inheritance tax

Question 47

In the 2018-2019 biennial budget,approximately what percentage of state expenditures went to higher education funding in Texas?

A) 45-50 percent
B) 35-40 percent
C) 25-30 percent
D) 15-20 percent
E) 5-10 percent

Question 48

Explain the role of the Legislative Budget Board.

Question 49

Which program allows parents to lock in the cost of future tuition and fees at a state university or college?

A) Teach for Texas Fund
B) Tuition Stability Fund
C) Available University Funds
D) Texas Grant towards Excellence Fund
E) Texas Tomorrow Funds

Question 50

What are the two ways expenditures are classified in the state of Texas? Compare and contrast these two approaches.

Question 51

Describe the system of public assistance in Texas,particularly as it applies to health care.Should the state of Texas make health and human services for children more of a priority? Why or why not?

Question 52

What is the name for accounts that can be used only for specifically named purposes?

A) Federal grants-in-aid
B) General Revenue Fund
C) Dedicated funds
D) General obligation and revenue bonds
E) Rainy Day Fund

Question 53

The state of Texas has one of the highest sales tax rates in the nation and does not have a state income tax.Is Texas's tax structure an example of a regressive or a progressive tax system? Explain.

Question 54

Identify and describe the nontax sources of revenue on which Texas relies.What are the positive and negative aspects of relying on these revenue sources? Which of these nontax revenues could Texas least afford to lose,and why?

Question 55

What is the purpose of the Economic Stabilization Fund in Texas? Describe how it was created and is used.

Question 56

Describe the various taxes imposed by the state of Texas to raise revenues.Identify the population that each tax targets and an approximation of which taxes raise the most revenues.

Question 57

Summarize the state's efforts to collect sales tax from online businesses.

Question 58

What are the rules regarding government debt in Texas? Why does the government borrow when it does? Describe both positive and negative aspects of the way that Texas handles government borrowing.

Question 59

Summarize the system of public school (K-12)funding in Texas.Why is unequal funding such a problem for public schools? Evaluate the "Robin Hood" plan for funding equalization.

Question 60

Summarize the procedure for developing and approving a state budget in Texas including the roles of both the executive and legislative branches.What are the positive and negative aspects of using a two-year budget cycle?

Question 61

Describe the difference between progressive and regressive revenues.Which groups in society benefit from each? Explain.