Question 1

Briefly describe the tradeoff between equity and efficiency of tax systems using a few examples.

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Question 2

What are the characteristic(s)of an efficient tax system?

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Question 3

Define horizontal equity and briefly describe some features of the U.S.federal income tax system that may interfere with achieving it.

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Question 4

Briefly describe why taxes create deadweight loss.

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Question 5

Define the average tax rate.

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Question 6

Define the deadweight loss of a tax.

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Question 7

What are the three categories of the costs of taxes to taxpayers?

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Question 8

The largest category of expenditures for state and local governments is __________.

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Question 9

Suppose that Deon places a $150 value on a new MP-3 player,and Juanita places a $140 value on it.The cost of the MP-3 player is $130.Suppose the government levies a $15 tax on MP-3 players,which raises the price to $145.What is the deadweight loss created by the tax?

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Question 10

Which of the following types of taxes achieves vertical equity: a proportional tax,regressive tax,and/or progressive tax?

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Question 11

Table 12-2
 
-Refer to Table 12-2.The tax system is an example of a __________ tax.

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-Refer to Table 12-2.The tax...

Question 12

What is the most efficient tax and why?

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Question 13

List several examples of the administrative burden of the U.S.income tax system.

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Question 14

Briefly describe some of the demographic trends that are predicted to increase the government's budget deficit.

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Question 15

Refer to Table 12-2.Would the tax system be justified due to the benefits principle?

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Question 16

Define the marginal tax rate.

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Question 17

Refer to Table 12-2.Does the tax system achieve vertical equity?

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Question 18

Briefly evaluate the advantages and disadvantages of a lump-sum tax.

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Question 19

If tax revenues from a cigarette tax are used to pay for health care expenses related to lung cancer,the cigarette tax could be justified using the __________.

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Quiz 12: The Design of the Tax System