Deck 121: Sec-121-Mc-A-Financial-Overview-Of-The-Us

Question 1

In 2011,the U.S.federal government collected approximately how much in total tax receipts?

A)$800 million
B)$2.5 billion
C)$5.2 billion
D)$8.7 billion

Answer 1

C

Question 2

Which of the following countries has lower total government tax revenue as a percentage of GDP than the United States?

A)Canada
B)Germany
C)Sweden
D)Mexico

Answer 2

C

Question 3

In 2011,which category represented the largest source of receipts for the U.S.federal government?

A)Medicare
B)Social Security
C)corporate income taxes
D)individual income taxes

Answer 3

B

Question 4

In 2011,the U.S.federal government collected approximately what percentage of the taxes in the economy?

A)10%
B)40%
C)50%
D)67%

Question 5

Which of the following is true about the percent of total income all levels of government in the U.S.take as taxes?

A)In 1902 the government collected about 7 percent of total income.In recent years,it collected about 30 percent of total income.
B)In 1902 the government collected about 30 percent of total income.In recent years,it collected about 7 percent of total income.
C)In 1902 the government collected about 7 percent of total income.In recent years,it collected about 7 percent of total income.
D)In 1902 the government collected about 30 percent of total income.In recent years,it collected about 30 percent of total income.

Question 6

Of the following countries,which country's government collects the least amount of tax revenue as a percentage of that country's total income?

A)Japan
B)United States
C)Mexico
D)Denmark

Question 7

A person's tax liability refers to

A)the percentage of income that a person must pay in taxes.
B)the amount of tax a person owes to the government.
C)the amount of tax the government is required to refund to each person.
D)deductions that can be legally subtracted from a person's income each year.

Question 8

Of the following countries,which country's government collects the largest amount of tax revenue as a percentage of that country's total income?

A)Denmark
B)United States
C)Canada
D)Greece

Question 9

The amount of income tax owed by a family is

A)not simply proportional to its total income.
B)unaffected by deductions.
C)total income minus tax credits.
D)a constant fraction of income.

Question 10

Over the past 100 years,as the U.S.economy's income has grown,

A)tax rates have decreased,while tax revenues have increased.
B)tax rates have increased,while tax revenues have decreased.
C)both tax rates and tax revenues have increased.
D)both tax rates and tax revenues have decreased.

Question 11

In 2011,approximately what percentage of the U.S.federal government's receipts came from individual income taxes?

A)9%
B)15%
C)43%
D)67%

Question 12

A family's income tax liability is

A)a standard percentage of all income earned.
B)determined by wage income rather than dividend and interest income.
C)based on total income.
D)constant from year to year.

Question 13

The largest source of revenue for the federal government is the

A)individual income tax.
B)property tax.
C)sales tax.
D)corporate income tax.

Question 14

The largest source of income for the federal government is

A)individual income taxes.
B)corporate taxes.
C)tariffs.
D)"sin" taxes on alcohol and cigarettes.

Question 15

Which of the following countries has the largest tax burden?

A)Mexico
B)Canada
C)United States
D)Denmark

Question 16

In 2011,the average American paid approximately how much to the federal government in taxes?

A)$2,000
B)$2,500
C)$8,000
D)$10,500

Question 17

The U.S.federal government collects about

A)one-third of the taxes in our economy.
B)one-half of the taxes in our economy.
C)two-thirds of the taxes in our economy.
D)three-fourths of the taxes in our economy.

Question 18

The federal taxes owed by a taxpayer depend

A)only upon the marginal tax rate on the taxpayer's first $25,000 of income.
B)only upon the marginal tax rate on the taxpayer's last $10,000 of income.
C)upon all the marginal tax rates up to the taxpayer's overall level of income.
D)upon all the marginal tax rates,including those for income levels that exceed the taxpayer's overall level of income.

Question 19

The U.S.federal government collects taxes in a number of ways.Rank the following sources of revenue from the largest to the smallest.

A)corporate income taxes,individual income taxes,social insurance taxes
B)social insurance taxes,individual income taxes,corporate income taxes
C)individual income taxes,social insurance taxes,corporate income taxes
D)individual income taxes,corporate income taxes,social insurance taxes

Question 20

The U.S.tax burden is

A)about the same as most European countries.
B)higher than most European countries.
C)lower than most European countries.
D)higher than all European countries.

Question 21

Corporate profits distributed as dividends are

A)tax free.
B)taxed once.
C)taxed twice.
D)taxed three times.

Question 22

A payroll tax is a tax on

A)the wages that a firm pays its workers.
B)earned and unearned income.
C)specific goods like gasoline and cigarettes.
D)corporate profits.

Question 23

Which of the following is an example of an excise tax?

A)a tax on the wages that a firm pays its workers
B)a tax on tobacco
C)a tax on corporate profits
D)the portion of federal income taxes earmarked to pay for Social Security and Medicare

Question 24

The revenue that the federal government collects from payroll taxes is earmarked to pay for

A)national defense and income security (welfare)programs
B)national defense and Medicare
C)Social Security and public schools
D)Social Security and Medicare

Question 25

An estate tax is an example of a(n)

A)individual income tax.
B)social insurance tax.
C)corporate income tax.
D)None of the above is correct.

Question 26

Which type of tax is used to finance the Social Security program in the United States?

A)consumption tax
B)income tax
C)payroll tax
D)property tax

Question 27

In the United States,the payroll tax is also called a

A)dividend income tax.
B)social insurance tax.
C)value added tax.
D)capital gains tax.

Question 28

The payroll tax differs from the individual income tax because the payroll tax is primarily earmarked to pay for

A)employer-provided pensions.
B)Social Security and Medicare.
C)employer-provided health benefits.
D)job loss and training programs.

Question 29

Which of the following is an example of a payroll tax?

A)a tax on the wages that a firm pays its workers
B)a "sin" tax on distilled alcohol
C)a tax on corporate profits
D)the portion of federal income taxes earmarked to pay for national defense

Question 30

A tax on the wages that a firm pays its workers is called

A)an income tax.
B)an excise tax.
C)a consumption tax.
D)a payroll tax.

Question 31

Corporate profits are

A)included in payroll taxes.
B)exempt from taxes.
C)taxed twice,once as profit and once as dividends.
D)taxed to pay for Medicare.

Question 32

The government taxes corporate income on the basis of

A)profit.
B)the amount the firm receives for the goods or services it sells.
C)the number of employees.
D)All of the above are correct.

Question 33

In 2011,what percentage of federal government receipts came from corporate income taxes?

A)7%
B)12%
C)25%
D)43%

Question 34

Which of the following are taxed?

A)both corporate profits and dividends shareholders receive
B)corporate profits but not dividends shareholders receive
C)dividends shareholders receive but not corporate profits
D)neither corporate profits nor dividends shareholders receive

Question 35

If New York City imposed a 50 cent tax on soft-drink beverages that contain sugar or high-fructose corn syrup,it would

A)be an excise tax.
B)be an income tax.
C)reduce tax revenue.
D)cause the supply of corn to rise.

Question 36

The two taxes that together provide the U.S.federal government with almost 80 percent of its revenue are

A)individual income taxes and property taxes.
B)individual income taxes and corporate income taxes.
C)individual income taxes and payroll taxes.
D)sales taxes and payroll taxes.

Question 37

The marginal tax rate for an unmarried taxpayer in the highest taxable income category for 2013 is approximately

A)80 percent.
B)50 percent.
C)40 percent.
D)20 percent.

Question 38

In 2011,social insurance taxes represented approximately what percentage of total receipts for the federal government?

A)5%
B)12%
C)36%
D)44%

Question 39

Taxes on specific goods such as gasoline and alcoholic beverages are called

A)excise taxes.
B)payroll taxes.
C)sales taxes.
D)social insurance taxes.

Question 40

Taxes on specific goods such as cigarettes,gasoline,and alcoholic beverages are called

A)sales taxes.
B)excise taxes.
C)social insurance taxes.
D)consumption taxes.

Question 41

The three largest categories of spending by the Federal government in order from first to third would be

A)income security,net interest,and national defense
B)national defense,net interest,and income security
C)income security,health,and national defense
D)health,income security,and national defense

Question 42

In 2011,approximately how much of federal government spending went to income security?

A)10%
B)25%
C)33%
D)50%

Question 43

The federal healthcare spending program that specifically targets the poor is called

A)Medicaid.
B)Medicare.
C)National Institutes of Health.
D)Blue Cross/Blue Shield.

Question 44

A transfer payment is a government payment

A)to companies that provide goods or services to government agencies.
B)designed to transfer funds from one government agency to another.
C)which transfers revenue from the federal government to state government.
D)not made in exchange for a good or service.

Question 45

The share of federal government spending on healthcare has risen substantially over time.This is most likely a result of

A)medical advances that provide new,better,but often more expensive medical treatments.
B)a rising population of the elderly in the economy.
C)health insurance reform that will include government subsidies for health insurance for many low-to-moderate income families.
D)All of the above are important factors.

Question 46

In 2011,which category represented the largest category of spending for the U.S.federal government?

A)health
B)income security
C)national defense
D)net interest

Question 47

The largest budgetary expense for the federal government in 2011 was

A)interest on the national debt.
B)health.
C)highways.
D)income security.

Question 48

Which of the following is not true about government spending on national defense?

A)It is the third-largest spending category for the U.S.federal government.
B)It includes salaries of military personnel.
C)It fluctuates over time as the political climate changes.
D)It is not financed with tax revenue.

Question 49

Medicaid is

A)the government's health plan for the elderly.
B)the government's health plan for the poor.
C)another name for Social Security.
D)Both a and c are correct.

Question 50

Like spending on Social Security,the share of federal government spending on Medicare has risen substantially over time.This is most likely a result of

A)a rising population of poor in the economy.
B)a rising population of the elderly in the economy.
C)an immigration policy that promotes an influx of migrant farm workers.
D)All of the above are important factors.

Question 51

Medicare is the

A)government's health plan for the elderly.
B)government's health plan for the poor.
C)another name for Social Security.
D)Both a and c are correct.

Question 52

As government debt increases,

A)Congress will reduce spending by an equal proportion.
B)the government must spend more revenue on interest payments.
C)a trade-off with government deficits is inevitable.
D)tax rates must rise to cover the deficit.

Question 53

Which of the following programs is not included in the federal income security spending?

A)Social Security
B)welfare
C)education
D)unemployment compensation

Question 54

The government's health plan for the elderly is called

A)Medicaid.
B)Medicare.
C)Social Security.
D)food stamps.

Question 55

In 2011,federal government receipts were approximately

A)$4,000 per person and federal government spending was approximately $8,000 per person,resulting in a budget deficit.
B)$8,000 per person and federal government spending was approximately $12,000 per person,resulting in a budget deficit.
C)$12,000 per person and federal government spending was approximately $8,000 per person,resulting in a budget surplus.
D)$8,000 per person and federal government spending was approximately $4,000 per person,resulting in a budget surplus.

Question 56

In 2011 the largest percentage of federal government spending was on

A)national defense.The largest source of federal revenues was from corporate income taxes.
B)health.The largest source of federal revenues was from individual income taxes.
C)income security.The largest source of federal revenues was from corporate income taxes.
D)income security.The largest source of federal revenues was from individual income taxes.

Question 57

All of the following are transfer payments except

A)welfare payments.
B)unemployment compensation.
C)personal income taxes.
D)Social Security.

Question 58

In 2011,the federal government spent 9 percent of the budget on net interest.Which of the following statements regarding net interest is correct?

A)If the government pays down its debt,the amount of the budget needed for net interest decreases.
B)If the government accrues more debt,the amount of the budget needed for net interest increases.
C)In 2011,the federal government spent 325 billion dollars to cover interest payments on its loans.
D)All of the above are correct.

Question 59

The U.S.federal government spends its revenues in a number of ways.Rank the following spending categories from largest to smallest.

A)income security,health,national defense,net interest
B)health,national defense,net interest,income security
C)net interest,health,income security,national defense
D)national defense,income security,net interest,health

Question 60

Federal government spending on Social Security,Medicare,and Medicaid as a percentage of GDP rose from

A)10 percent in 1950 to more than 50 percent today.
B)10 percent in 1950 to more than 20 percent today.
C)1 percent in 1950 to more than 10 percent today.
D)1 percent in 1950 to more than 20 percent today.

Question 61

The most common explanation for Social Security payments accounting for a larger share of federal government expenditures is

A)increases in life expectancy.
B)people becoming eligible for Social Security benefits at an earlier age.
C)increases in birth rates among teenagers and the poor.
D)falling payroll tax receipts.

Question 62

The "other" category of federal spending consists of many less expensive functions of government,including all of the following except

A)housing credit programs.
B)farm support programs.
C)funding for the National Institutes of Health.
D)the federal court system.

Question 63

Suppose that in 2020 the average citizen's federal tax bill is $12,466,and total federal spending is $10,824 per person.In 2020,the federal government will have

A)a budget surplus.
B)a budget deficit.
C)horizontal equity.
D)vertical equity.

Question 64

Most analysts expect the largest federal spending category to continue to grow in importance for many years into the future.What category of spending is this?

A)national defense
B)education
C)income security
D)farm support programs

Question 65

If a government sells debt to help meet its expenditures,then the government has a

A)budget surplus.Other things the same,the surplus rises if government expenditures rise.
B)budget surplus.Other things the same,the surplus rises if government expenditures fall.
C)budget deficit.Other things the same,the deficit rises if government expenditures rise.
D)budget deficit.Other things the same the deficit rises if government expenditures fall

Question 66

When government receipts exceed total government spending during a fiscal year,the difference is

A)a budget surplus.
B)a budget deficit.
C)the national debt.
D)automatically refunded.

Question 67

Suppose that in 2020 the average citizen's federal tax bill is $9,372,and total federal spending is $10,824 per person.In 2020,the federal government will have

A)a budget surplus.
B)a budget deficit.
C)horizontal equity.
D)vertical equity.

Question 68

From 2009 to 2012,the federal budget deficits were the largest budget shortfalls since World War II.The primary reason for the record-large deficits was

A)the recession experienced during this time.
B)severe budget tightening by members of Congress.
C)the shift in political power from Republicans to Democrats.
D)All of the above are correct.

Question 69

The government finances the budget deficit by

A)borrowing from the public.
B)borrowing solely from the Federal Reserve Bank.
C)printing currency in the amount of the budget deficit.
D)requiring that budget surpluses occur every other year to pay off the deficits.

Question 70

Suppose that in 2020 the average citizen's federal tax bill is $11,888 per person,and total federal spending is $13,997 per person.In 2020,the federal government will have

A)a per person budget surplus of $2,109.
B)a per person budget deficit of $2,109.
C)horizontal equity.
D)vertical equity.

Question 71

Suppose that in 2020 the average citizen's federal tax bill is $11,987,and total federal spending is $12,294 per person.In 2020,the federal government will have

A)a budget surplus.
B)a budget deficit.
C)horizontal equity.
D)vertical equity.

Question 72

As the economy's income has grown,the government has

A)grown at about the same pace.
B)grown at a faster pace.
C)grown at a slower pace.
D)shrunk.

Question 73

From 1950 to today,government spending on Social Security,Medicare,and Medicaid as a percentage of GDP has

A)decreased from about ten percent to less than one percent.
B)increased from less than one percent to about ten percent.
C)remained constant at less than one percent.
D)remained constant at about ten percent.

Question 74

Which of the following contributes to the projected rise in government spending on Social Security and Medicare as a percentage of GDP?

A)increasing life expectancies
B)increasing healthcare costs
C)increasing fertility rates
D)Both a and b are correct.

Question 75

Suppose that in 2020 the average citizen's federal tax bill is $14,888 per person,and total federal spending is $13,997 per person.In 2020,the federal government will have

A)a per person budget surplus of $891.
B)a per person budget deficit of $891.
C)horizontal equity.
D)vertical equity.

Question 76

In 1950 there were approximately 7 working age people for every elderly person;however,in 2050 there will be

A)only 2.5 working people for every elderly person.
B)only 5 working age people for every elderly person.
C)10 working age people for every elderly person.
D)14 working age people for every elderly person.

Question 77

If government spending exceeds government receipts,the government has a

A)budget surplus.Other things the same,the surplus rises if taxes rise.
B)budget surplus.Other things the same the surplus rises if taxes fall.
C)budget deficit.Other things the same,the deficit rises if taxes rise.
D)budget deficit.Other things the same,the deficit rises if taxes fall.

Question 78

Which of the following is an important reason for the projected increase in government spending as a percentage of GDP over the next several decades?

A)the increase in life expectancy resulting from advances in healthcare
B)an increase in the average number of children per family.
C)the increase in the number of jobs lost each year to foreign countries as a result of outsourcing
D)the reduction in the number of high-cost medical procedures

Question 79

A budget deficit

A)occurs when government receipts are less than spending.
B)occurs when government spending is less than receipts.
C)occurs when government receipts are equal to spending.
D)is the accumulation of years of government overspending.

Question 80

The U.S.federal government finances budget deficits by

A)selling stock,much like a corporation.
B)printing additional currency.
C)borrowing from the public.
D)raising property taxes.