Relatively high tax designed to raise revenue and reduce consumption of a socially undesirable product such as liquor or tobacco.
Sin tax
100
What is an estate tax?
It is the tax the govt. levies on the transfer of property when a person dies.
100
GDP =___________(4 Components)
Consumption+ Investments+ Government + Net Exports.
100
income that is left after all taxes except the corporate profits subtracted from NNP
National Income
100
What are the 3 general taxes used in the U.S?
Proportional taxes impose the same percentage disregarding income. Regressive taxes impose a higher percentage rate on lower incomes than higher incomes. Progressive taxes impose a higher percentage rate to higher incomes.
200
Internal Revenue Service (IRS)-
Branch of US Treasury Dep. In charge of collecting taxes.
200
What does the 16th Amendment do?
The 16th Amendment allows Congress to levy an income tax?
200
When the price level rises there is a ________ the aggregate demand curve.
Moves up along
200
Total amount of income going to consumers before individual income taxes are subtracted.
Personal Income
200
Who has the final approval of the federal budget?
The president approves the budget because Congress tweaked it and returned it. If he doesn’t see his original idea to a degree, he can veto the bill.
300
Annual report to the IRS summarizing total income, deductions and taxes within employers
Tax return
300
Discretionary spending is spent on
Discretionary spending is spent on welfare, Coast Guard, and military.
300
What are some characteristics of money?
Money in the U.S. is divisible, durable, portable, and it has limited availability.
300
rise in the general price level
Inflation
300
The fiscal year starts on______________ and goes through _______?
The fiscal year is for the federal budget. It starts on October 1 and goes to September 30.
400
Exceptions or oversights in the tax law that allow some people and businesses to avoid paying taxes.
Tax loophole
400
What are the criteria for effective taxes?
Simplicity, equity and efficiency of a tax.
400
What were disadvantages and advantages of The Gold Standard?
The Gold Standard was when the U.S. fixed the price of gold to be exchanged. The disadvantage of it was the price change. The advantages of the Gold Standard are people feel secure and it prevents the government from printing too much paper.
400
Nonmarket transactions-
transactions that don’t take place in the market(hard to measure)
400
Smuggling, prostitution, drug dealing and gambling are a part of
Underground Economy
500
Flat tax
proportional tax on individual income after a specified threshold has been reached
500
What is a limitation of the Benefit Principle?
The benefits are difficult to measure and many people can’t pay it back when they receive the benefits.
500
The Great Recession occurred because
The housing market crashed because too many risks were taken. Also, many bad loans were given out to people.
500
Statistical series that can be used to measure changes in price over time.
Price Index
500
What is the difference between current GDP and real GDP?
Current GDP is GDP that is not adjusted to remove inflation. Real GDP is GDP where inflation is taken out.