Question 1

To calculate a tax,you need to know: I.the tax base
II) the taxing agency
III) the tax rate
IV) the purpose of the tax

Accepted Answer

A)  Only I is correct.
B)  Only IV is correct.
C)  Only III is correct.
D)  Items I through IV are correct.
E)  I and III are correct.F) A) and E)
G) None of the above

Question 2

Consider the following tax rate structures.Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Accepted Answer

The tax rate schedule is horizontally eq...

Question 3

A taxpayer's average tax rate is the most appropriate tax rate to use in tax planning.

Accepted Answer

A) True 
 B)False

Question 4

The two components of the tax calculation are the tax rate and the taxpayer's status.

Accepted Answer

A) True 
 B)False

Question 5

Taxes influence many types of business decisions but generally do not influence personal decisions.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is true regarding tax-advantaged assets?

Accepted Answer

A)  They are typically subject to excise taxes to account for their low explicit taxes.
B)  A corporate bond is typically considered a tax-advantaged asset.
C)  They are often subject to implicit taxes.
D)  A corporate bond is typically considered a tax-advantaged asset.They are often subject to implicit taxes but they are not typically subject to excise taxes to account for their low explicit taxes.
E)  None of the choices are correct.F) B) and D)
G) A) and E)

Question 7

Taxes influence business decisions such as where a business should locate or how a business should be structured.

Accepted Answer

A) True 
 B)False

Question 8

The difficulty in calculating a tax is typically in the determination of:

Accepted Answer

A)  the correct tax rate.
B)  where to file the tax return.
C)  the tax base.
D)  the due date for the return.
E)  None of the choices are correct.F) B) and D)
G) C) and E)

Question 9

Leonardo,who is married but files separately,earns $80,000 of taxable income.He also has $15,000 in city of Tulsa bonds.His wife,Theresa,earns $50,000 of taxable income. If Leonardo earned an additional $30,000 of taxable income this year,what would be the marginal tax rate (rounded) on the extra income for 2019? (Use tax rate schedule.)

Accepted Answer

A)  22.00 percent
B)  18.81 percent
C)  24.00 percent
D)  23.72 percent
E)  None of the choices are correctF) D) and E)
G) A) and D)

Question 10

Which of the following is considered a tax?

Accepted Answer

A)  Tolls
B)  Parking meter fees
C)  Annual licensing fees
D)  A local surcharge paid on retail sales to fund public schools
E)  Entrance fees paid at national parksF) A) and B)
G) C) and D)

Question 11

Jackson has the choice to invest in city of Mitchell bonds or Sundial,Inc.corporate bonds that pay 10 percent interest.Jackson is a single taxpayer who earns $55,000 annually.Assume that the city of Mitchell bonds and the Sundial,Inc.bonds have similar risk. Assume the original facts as given except that Jackson is a head of household taxpayer and the city of Mitchell pays interest of 8 percent.How would you advise Jackson to invest his money?

Accepted Answer

A)  Invest in Sundial,Inc.bonds because their explicit tax is greater than the implicit tax on city of Mitchell bonds.
B)  Invest in city of Mitchell bonds because their implicit tax is greater than the explicit tax on Sundial,Inc.bonds.
C)  Invest in Sundial,Inc.bonds because their explicit tax is less than the implicit tax on city of Mitchell bonds.
D)  Invest in city of Mitchell bonds because their implicit tax is less than the explicit tax on Sundial,Inc.bonds.
E)  None of the choices are correct.F) A) and B)
G) A) and C)

Question 12

Marc,a single taxpayer,earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds.Using the U.S.tax rate schedule for year 2019,what is his current marginal tax rate? (Use tax rate schedule.)

Accepted Answer

A)  12.00 percent
B)  22.00 percent
C)  24.00 percent
D)  32.00 percent
E)  None of the choices are correctF) None of the above
G) All of the above

Question 13

One key characteristic of a tax is that it is a required payment to a governmental agency.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is true regarding real property taxes and personal property taxes?

Accepted Answer

A)  Personal property taxes are assessed on permanent structures and land.
B)  Real property taxes are assessed on cars and boats.
C)  All U.S.states currently impose personal property taxes.
D)  Real property taxes are generally easier to administer than personal property taxes.
E)  None of the choices are correct.F) A) and D)
G) A) and C)

Question 15

Margaret was issued a $150 speeding ticket.This is:

Accepted Answer

A)  a tax because payment is required by law.
B)  a tax because the payment is not related to any specific benefit received from the government agency collecting the ticket.
C)  not a tax because it is considered a fine intended to punish illegal behavior.
D)  a tax because it is imposed by a government agency.
E)  not a tax because Margaret could have avoided payment if she did not speed.F) B) and E)
G) A) and C)

Question 16

Which of the following statements is true?

Accepted Answer

A)  Municipal bond interest is subject to explicit federal tax.
B)  Municipal bond interest is subject to implicit tax.
C)  Municipal bonds typically pay a higher interest rate than corporate bonds with similar risk.
D)  All of these statements are true.
E)  None of these statements are true.F) None of the above
G) D) and E)

Question 17

One must consider the "economy" criterion in evaluating tax systems from both the taxpayer's and the government's perspective.

Accepted Answer

A) True 
 B)False

Question 18

The state of Georgia recently increased its tax on a carton of cigarettes by $2.00.What type of tax is this?

Accepted Answer

A)  A sin tax
B)  An excise tax
C)  It is not a tax; it is a fine
D)  A sin tax and an excise tax are correct
E)  None of the choices are correctF) D) and E)
G) A) and D)

Question 19

In terms of effective tax rates,the sales tax can be viewed as a regressive tax.

Accepted Answer

A) True 
 B)False

Question 20

Raquel recently overheard two journalism students discussing the merits of the federal tax system.One student offered as an example of unfairness a well-known politician's spouse,who paid little income tax,as most of the spouse's income was earned in the form of municipal bond interest.What type of taxes is the journalism student considering in his example? What type of taxes is he ignoring? Define each type of tax.What role does each type of tax play in calculating relative tax burdens? What role does each type of tax play in evaluating fairness?

Accepted Answer

The student is considering explicit taxe...

Exam 1: An Introduction to Tax

Taxes influence many types of business decisions but generally do not influence personal decisions.

Correct Answer
verified

The difficulty in calculating a tax is typically in the determination of:

Correct Answer
verified

In terms of effective tax rates,the sales tax can be viewed as a regressive tax.

Correct Answer
verified

Correct Answer
verified
The student is considering explicit taxe...
View Answer

Which of the following statements is true?

Correct Answer
verified

Which of the following is considered a tax?

Correct Answer
verified

To calculate a tax,you need to know: I.the tax base II) the taxing agency III) the tax rate IV) the purpose of the tax

Correct Answer
verified

Correct Answer
verified

A taxpayer's average tax rate is the most appropriate tax rate to use in tax planning.

Correct Answer
verified

Consider the following tax rate structures.Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Correct Answer
verified
The tax rate schedule is horizontally eq...
View Answer

The state of Georgia recently increased its tax on a carton of cigarettes by $2.00.What type of tax is this?

Correct Answer
verified

One key characteristic of a tax is that it is a required payment to a governmental agency.

Correct Answer
verified

Which of the following is true regarding real property taxes and personal property taxes?

Correct Answer
verified

Which of the following is true regarding tax-advantaged assets?

Correct Answer
verified

Taxes influence business decisions such as where a business should locate or how a business should be structured.

Correct Answer
verified

Correct Answer
verified

One must consider the "economy" criterion in evaluating tax systems from both the taxpayer's and the government's perspective.

Correct Answer
verified

The two components of the tax calculation are the tax rate and the taxpayer's status.

Correct Answer
verified

Marc,a single taxpayer,earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds.Using the U.S.tax rate schedule for year 2019,what is his current marginal tax rate? (Use tax rate schedule.)

Correct Answer
verified

Margaret was issued a $150 speeding ticket.This is:

Correct Answer
verified

Exam 1: An Introduction to Tax

Taxes influence many types of business decisions but generally do not influence personal decisions.

Correct AnswerverifiedShow Answer

The difficulty in calculating a tax is typically in the determination of:

Correct AnswerverifiedShow Answer

In terms of effective tax rates,the sales tax can be viewed as a regressive tax.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe student is considering explicit taxe...View AnswerShow Answer

Which of the following statements is true?

Correct AnswerverifiedShow Answer

Which of the following is considered a tax?

Correct AnswerverifiedShow Answer

To calculate a tax,you need to know: I.the tax base II) the taxing agency III) the tax rate IV) the purpose of the tax

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A taxpayer's average tax rate is the most appropriate tax rate to use in tax planning.

Correct AnswerverifiedShow Answer

Consider the following tax rate structures.Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Correct AnswerverifiedThe tax rate schedule is horizontally eq...View AnswerShow Answer

The state of Georgia recently increased its tax on a carton of cigarettes by $2.00.What type of tax is this?

Correct AnswerverifiedShow Answer

One key characteristic of a tax is that it is a required payment to a governmental agency.

Correct AnswerverifiedShow Answer

Which of the following is true regarding real property taxes and personal property taxes?

Correct AnswerverifiedShow Answer

Which of the following is true regarding tax-advantaged assets?

Correct AnswerverifiedShow Answer

Taxes influence business decisions such as where a business should locate or how a business should be structured.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

One must consider the "economy" criterion in evaluating tax systems from both the taxpayer's and the government's perspective.

Correct AnswerverifiedShow Answer

The two components of the tax calculation are the tax rate and the taxpayer's status.

Correct AnswerverifiedShow Answer

Marc,a single taxpayer,earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds.Using the U.S.tax rate schedule for year 2019,what is his current marginal tax rate? (Use tax rate schedule.)

Correct AnswerverifiedShow Answer

Margaret was issued a $150 speeding ticket.This is:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The student is considering explicit taxe...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The tax rate schedule is horizontally eq...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified