$$\begin{array} { | c | c | }
\hline \text { Gross Domestic Product (GDP) } & \text { Consumption (C) } \
\hline \$ 0 & \$ 40 \
\hline 100 & 120 \
\hline 200 & 200 \
\hline 300 & 280 \
\hline 400 & 360 \
\hline
\end{array}$$ The accompanying table is the before-tax consumption schedule for a closed economy. If a lump-sum tax (the same tax amount at each level of GDP) of $40 is imposed in this economy, the tax system
A) is regressive.
B) is proportional.
C) is progressive.
D) may be either proportional or progressive.

Question

$$\begin{array} { | c | c | } 
\hline \text { Gross Domestic Product (GDP) } & \text { Consumption (C) } \
\hline \$ 0 & \$ 40 \
\hline 100 & 120 \
\hline 200 & 200 \
\hline 300 & 280 \
\hline 400 & 360 \
\hline
\end{array}$$ The accompanying table is the before-tax consumption schedule for a closed economy. If a lump-sum tax (the same tax amount at each level of GDP) of $40 is imposed in this economy, the tax system
A) is regressive.
B) is proportional.
C) is progressive.
D) may be either proportional or progressive.

Quizplus · Accepted Answer

The Answer of $$\begin{array} { | c | c | } 
\hline \text { Gross Domestic Product (GDP) } & \text { Consumption (C) } \
\hline \$ 0 & \$ 40 \
\hline 100 & 120 \
\hline 200 & 200 \
\hline 300 & 280 \
\hline 400 & 360 \
\hline
\end{array}$$ The accompanying table is the before-tax consumption schedule for a closed economy. If a lump-sum tax (the same tax amount at each level of GDP) of $40 is imposed in this economy, the tax system
A) is regressive.
B) is proportional.
C) is progressive.
D) may be either proportional or progressive.

The Accompanying Table Is the Before-Tax Consumption Schedule for a