Question 1

Tax-free loans to Canadian students are an example of

Accepted Answer

A) in-kind transfers. 
B) provision of public goods. 
C) free-rider problems. 
D) subsidies for merit goods. 
A) in-kind transfers. 
B) provision of public goods. 
C) free-rider problems. 
D) subsidies for merit goods.

Question 2

If the marginal tax rate is less than the average rate,the system is

Accepted Answer

A) proportional. 
B) regressive. 
C) progressive. 
D) liberal. 
A) proportional. 
B) regressive. 
C) progressive. 
D) liberal.

Question 3

A flat-tax on all personal income would be an example of

Accepted Answer

A) a regressive tax. 
B) a progressive tax. 
C) a value added tax. 
D) a proportional tax. 
A) a regressive tax. 
B) a progressive tax. 
C) a value added tax. 
D) a proportional tax.

Question 4

Examples of transfer payments are

Accepted Answer

A) wages,profits,interest and rents. 
B) federal government spending for national defense. 
C) benefits provided by CPP,welfare,and employment insurance. 
D) salaries of educators,police,and fire fighters. 
A) wages,profits,interest and rents. 
B) federal government spending for national defense. 
C) benefits provided by CPP,welfare,and employment insurance. 
D) salaries of educators,police,and fire fighters.

Question 5

A tax system characterized by a constant marginal tax rate is a

Accepted Answer

A) progressive tax system. 
B) proportional tax system. 
C) regressive tax system. 
D) fair tax system. 
A) progressive tax system. 
B) proportional tax system. 
C) regressive tax system. 
D) fair tax system.

Question 6

Cocaine is an example of

Accepted Answer

A) a free good. 
B) a public good. 
C) a merit good. 
D) a demerit good. 
A) a free good. 
B) a public good. 
C) a merit good. 
D) a demerit good.

Question 7

What is the free-rider problem and how is it related to public goods?

Accepted Answer

The free-rider problem arises from the d

Question 8

The corporate income tax in Canada

Accepted Answer

A) excludes dividends paid out. 
B) results in individuals being double-taxed on corporate earnings. 
C) only taxes retained earnings. 
D) does not apply to profits earned on exports. 
A) excludes dividends paid out. 
B) results in individuals being double-taxed on corporate earnings. 
C) only taxes retained earnings. 
D) does not apply to profits earned on exports.

Question 9

The largest source of receipts for the Canadian federal government is

Accepted Answer

A) corporate income taxes. 
B) personal income taxes. 
C) capital gains taxes. 
D) import duties. 
A) corporate income taxes. 
B) personal income taxes. 
C) capital gains taxes. 
D) import duties.

Question 10

Tax incidence refers to

Accepted Answer

A) determining who sends the taxes into the government. 
B) the tendency of some people to avoid paying taxes at all. 
C) the distribution of tax burdens among groups. 
D) determining the marginal tax rate applied to any increase in income. 
A) determining who sends the taxes into the government. 
B) the tendency of some people to avoid paying taxes at all. 
C) the distribution of tax burdens among groups. 
D) determining the marginal tax rate applied to any increase in income.

Question 11

A tax system that has higher marginal tax rates as income increases is known as a

Accepted Answer

A) flat-rate tax system. 
B) proportional tax system. 
C) progressive tax system. 
D) regressive tax system. 
A) flat-rate tax system. 
B) proportional tax system. 
C) progressive tax system. 
D) regressive tax system.

Question 12

To protect the competitive economic system by restricting the formation of monopolies,the government has passed and enforced

Accepted Answer

A) anti-combines laws. 
B) tort laws. 
C) zoning laws. 
D) regulatory laws. 
A) anti-combines laws. 
B) tort laws. 
C) zoning laws. 
D) regulatory laws.

Question 13

The legal system in Canada generally tends

Accepted Answer

A) to discourage the entry of new business firms. 
B) to support monopolies. 
C) to promote competition. 
D) to actively discourage unionization. 
A) to discourage the entry of new business firms. 
B) to support monopolies. 
C) to promote competition. 
D) to actively discourage unionization.

Question 14

Suppose the tax rate on the first $10,000 income is zero 10% on the next $20,000;20% on the next $20,000;30% on the next $30,000;and 40% on any income over $80,000.Family A has income of $40,000 and Family B has income of $100,000.What is the marginal and average tax rate for each family?

Accepted Answer

A) Family A: marginal--20%;average--15%;Family B: marginal 40%;average 20%. 
B) Family A: marginal--20%;average--10%;Family B: marginal 40%;average 23%. 
C) Family A: marginal--20%;average--20%;Family B: marginal 40%;average 40%. 
D) Family A: marginal--10%;average--10%;Family B: marginal 30%;average 30%. 
A) Family A: marginal--20%;average--15%;Family B: marginal 40%;average 20%. 
B) Family A: marginal--20%;average--10%;Family B: marginal 40%;average 23%. 
C) Family A: marginal--20%;average--20%;Family B: marginal 40%;average 40%. 
D) Family A: marginal--10%;average--10%;Family B: marginal 30%;average 30%.

Question 15

Suppose the marginal tax rate and the average tax rate are identical at all income levels.What kind of a tax system would this be? Explain.

Accepted Answer

A proportional tax system is one charact

Question 16

The free-rider problem is

Accepted Answer

A) the use of the public goods provided by a state by residents of another state. 
B) the incentive people have to avoid paying for a good they cannot be excluded from consuming. 
C) the incentive people have once they are receiving welfare to keep getting welfare. 
D) that people cannot be forced to accept public goods. 
A) the use of the public goods provided by a state by residents of another state. 
B) the incentive people have to avoid paying for a good they cannot be excluded from consuming. 
C) the incentive people have once they are receiving welfare to keep getting welfare. 
D) that people cannot be forced to accept public goods.

Question 17

Which of the following goods is subject to the free-rider problem?

Accepted Answer

A) a public transit system 
B) a public golf club 
C) national defense 
D) a public university 
A) a public transit system 
B) a public golf club 
C) national defense 
D) a public university

Question 18

Explain the similarities and differences between market and public-sector decision-making.

Accepted Answer

Decision-makers in both the public and p

Question 19

Which of the following activities is NOT an economic function of government?

Accepted Answer

A) providing merit goods 
B) promoting competition 
C) providing a legal system 
D) ensuring economic stability 
A) providing merit goods 
B) promoting competition 
C) providing a legal system 
D) ensuring economic stability

Question 20

A capital gain is defined as

Accepted Answer

A) the tax rate one pays when one moves into a higher tax bracket. 
B) a positive difference between the purchase price and the sale price of an asset. 
C) an unanticipated increase in income. 
D) the tax paid when one sells an asset. 
A) the tax rate one pays when one moves into a higher tax bracket. 
B) a positive difference between the purchase price and the sale price of an asset. 
C) an unanticipated increase in income. 
D) the tax paid when one sells an asset.

Tax-free loans to Canadian students are an example of

If the marginal tax rate is less than the average rate,the system is

A flat-tax on all personal income would be an example of

Examples of transfer payments are

A tax system characterized by a constant marginal tax rate is a

Cocaine is an example of

What is the free-rider problem and how is it related to public goods?

The corporate income tax in Canada

The largest source of receipts for the Canadian federal government is

Tax incidence refers to

A tax system that has higher marginal tax rates as income increases is known as a

To protect the competitive economic system by restricting the formation of monopolies,the government has passed and enforced

The legal system in Canada generally tends

Suppose the tax rate on the first $10,000 income is zero 10% on the next $20,000;20% on the next $20,000;30% on the next $30,000;and 40% on any income over $80,000.Family A has income of $40,000 and Family B has income of $100,000.What is the marginal and average tax rate for each family?

Suppose the marginal tax rate and the average tax rate are identical at all income levels.What kind of a tax system would this be? Explain.

The free-rider problem is

Which of the following goods is subject to the free-rider problem?

Explain the similarities and differences between market and public-sector decision-making.

Which of the following activities is NOT an economic function of government?

A capital gain is defined as

The Nature of Economics

Production Possibilities and Economic Systems

Demand and Supply

Introduction to Macroeconomics

Measuring the Economys Performance

Modelling Real Gdp and the Price Level in the Long Run

Economic Growth and Development

Modelling Real Gdp and the Price Level in the Short Run

Consumption, investment, and the Multiplier

Fiscal Policy and the Public Debt

Money and the Banking System

Money Creation and Deposit Insurance

The Bank of Canada and Monetary Policy

Issues in Stabilization Policy

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 10: The Public Sector

Tax-free loans to Canadian students are an example of

If the marginal tax rate is less than the average rate,the system is

A flat-tax on all personal income would be an example of

Examples of transfer payments are

A tax system characterized by a constant marginal tax rate is a

Cocaine is an example of

What is the free-rider problem and how is it related to public goods?

The corporate income tax in Canada

The largest source of receipts for the Canadian federal government is

Tax incidence refers to

A tax system that has higher marginal tax rates as income increases is known as a

To protect the competitive economic system by restricting the formation of monopolies,the government has passed and enforced

The legal system in Canada generally tends

Suppose the tax rate on the first $10,000 income is zero 10% on the next $20,000;20% on the next $20,000;30% on the next $30,000;and 40% on any income over $80,000.Family A has income of $40,000 and Family B has income of $100,000.What is the marginal and average tax rate for each family?

Suppose the marginal tax rate and the average tax rate are identical at all income levels.What kind of a tax system would this be? Explain.

The free-rider problem is

Which of the following goods is subject to the free-rider problem?

Explain the similarities and differences between market and public-sector decision-making.

Which of the following activities is NOT an economic function of government?

A capital gain is defined as

The Nature of Economics

Production Possibilities and Economic Systems

Demand and Supply

Introduction to Macroeconomics

Measuring the Economys Performance

Modelling Real Gdp and the Price Level in the Long Run

Economic Growth and Development

Modelling Real Gdp and the Price Level in the Short Run

Consumption, investment, and the Multiplier

Fiscal Policy and the Public Debt

Money and the Banking System

Money Creation and Deposit Insurance

The Bank of Canada and Monetary Policy

Issues in Stabilization Policy

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters