Exam 18: Public Choice, Taxes, and the Distribution of Income

Income inequality increases as the Gini coefficient approaches 1.

If, as your taxable income decreases, you pay a smaller percentage of your taxable income in taxes, then the tax is

Figure 18-4 -Refer to Figure 18-4. Rank the above panels in terms of most unequal income distribution to least unequal income distribution.

What is meant by the term "rational ignorance"?

The Gini coefficient is measured by

A key insight of the public choice model is that public policymakers are likely to pursue the public's interest, even if their self-interests conflict with the public interest.

If you pay $3,000 in taxes on an income of $28,000, and $4,450 in taxes on an income of $38,000, what is your marginal tax rate? Show your work.

Table 18-7 Table 18-7 shows the amount of taxes paid on various levels of income. -Refer to Table 18-7. The tax system is

The average tax rate is calculated as

What is the term that explains why voters often lack knowledge of pending legislation, and lack knowledge of the views of candidates for office on a range of issues that affect their own (the voters') welfare?

If the government is most interested in minimizing excess burden of an excise tax, should it impose the tax on goods that are elastic or on goods that are inelastic?

Figure 18-5 Figure 18-5 shows the Lorenz curve for a hypothetical country. -Refer to Figure 18-5. The middle 20 percent of households

Table 18-1 Suppose $1 billion is available in the budget and Congress is considering allocating the funds to one of the following three alternatives: 1) Subsidies for education, 2) Research on Alzheimer's or 3) Increased border security. Table 18-1 shows three voters' rankings of the alternatives. -Refer to Table 18-1. Suppose a series of votes are taken in which each pair of alternatives is considered in turn. If the vote is between allocating funds to research on Alzheimer's and increased border security,

An example of a payroll tax in the United States is

As the value of the Gini coefficient approaches one,

Some individuals seek to use government action to make themselves better off at the expense of others. The actions of these individuals

The marginal tax rate is

Figure 18-2 Figure 18-2 shows a demand curve and two sets of supply curves, one set more elastic than the other. -Refer to Figure 18-2. If the government imposes an excise tax of $1.00 on every unit sold, what is the size of the deadweight loss, if there is any?

If you pay $2,000 in taxes on an income of $20,000, and a tax of $3,000 on an income of $30,000, then over this range of income the tax is

The government of Silverado raises revenue to operate the city's hospital, open to all residents, through a general income tax paid by its residents. This method of raising revenue is consistent with the benefits-received principle.