Multiple Choice
Identify the choice that
best completes the statement or answers the question.
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1.
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The definition for tax rate is.....
a. | the price of the item that is taxed | b. | a compulsory charge to individuals and
businesses to pay for the operation of government | c. | when income increases, the percentage of tax
paid increases | d. | the percentage of tax levied |
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2.
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The price of the item that is taxed is known as the.....
a. | tax base | c. | regressive tax | b. | tax rate | d. | proportional
tax |
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3.
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Federal and state income taxes are examples of _________________ taxes.
a. | proportional | b. | progressive | c. | regressive | d. | flat |
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4.
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The ability-to-pay principle is a principle that states that as wealth or income
increases, a person’s ability to pay taxes increases even more rapidly. This is an example of a
.......
a. | progressive tax | c. | proportional tax | b. | regressive tax | d. | sales tax |
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5.
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Sales tax is an example of a _________ tax (assuming two individuals pay the
same amount in taxes but make different incomes).
a. | progressive | b. | regressive | c. | proportional | d. | flat |
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6.
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The largest source of government revenue is ......
a. | personal income tax | c. | excise taxes | b. | corporate income tax | d. | sales tax |
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7.
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Which amendment to the Constitution allows for income tax?
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8.
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Income tax in the United States was first implemented in 1861 to help finance
what war?
a. | Revolutionary | c. | French & Indian | b. | Civil | d. | World War I |
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Completion
Complete each
statement.
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9.
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Another name for a flat tax is a ________________ tax.
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10.
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What do you call the type of tax where everyone pays the same amount?
____________________
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