The negative effect on the economy that occurs when average tax rates increase because taxpayers have moved into higher income brackets during an expansion is ?

Related Mcqs:

1. 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

2. Imagine there is no tax on income up to Rs 1000 after that there is a tax of 505 what is the average tax rate on an income of Rs 20,000 ?

   A. Rs 50000
   B. 20%
   C. 25%
   D. Rs 10000

3. If people with higher incomes pay a higher percentage of income in taxes, the income tax structure is ?

   A. progressive
   B. regressive
   C. value added taxes (VAT)
   D. excise taxes

4. If the income tax rate changes from 30% to 40% on income over Rs30,000 and a person’s income is Rs 31,000 then her marginal tax rate is ?

   A. 30%
   B. 10%
   C. 70%
   D. 40%

5. The property tax wealth tax inheritance tax and income taxes such as persona and corporate taxes are ?

   A. indirect taxes
   B. direct taxes
   C. inelastic
   D. value-added tax

6. According to the Laffer curve, as tax rates increase tax revenue ?

   A. initially increase and then decrease
   B. decrease continuously.
   C. rise continuously
   D. initially decrease and then increase.

7. According to the Laffer curve as tax rates increase tax revenue ?

   A. initially increase and then decrease
   B. decrease continuously
   C. rise continuously
   D. initially decrease and then increase

8. A progressive income tax means that those with a higher income pay ?

   A. a higher percentage of their income in taxes then low income people
   B. a lower percentage of their income in taxes than low income people
   C. the same percentage of their income in taxes as low income people all the taxes in the economy.
   D. all the taxes in the economy

9. If the income effect is smaller than the substitution effect, higher net wages will ?

   A. reduce the supply of labour.
   B. increase the demand for labour
   C. increase the supply of labour
   D. have no effect on the supply of labour

10. The income effect of a price increase of a normal good is to ________ of that good and the substitution effect is to _________ of that good?

    A. increase quantity demanded, reduce quantity demanded
    B. increase quantity demanded, increases quantity demanded
    C. reduce quantity demanded, reduce quantity demanded
    D. reduce quantity demanded, increase quantity demanded