An increase in the income tax rate _____ disposable income and _____ consumption

Question

An increase in the income tax rate _____ disposable income and _____ consumption spending.

Answer

decreases, decreases

increases, decreases

increases, increases

decreases, increases

Which of the following is true about labor and capital income taxation?

Capital income (corporate profits, dividends and capital gains) is taxed at the same rate as labor income.

A change in capital income tax rates does not change potential GDP.

An increase in capital income tax rates leads to a decrease in investment.

It's better for the economy to tax capital income rather than labor income.

All of the above are true.

Most of U.S. Federal government debt is held by

China

Oil producing nations

Japan

United Kingdom

U.S. entities

decreases, decreases

increases, decreases

increases, increases

decreases, increases

Which of the following is true about labor and capital income taxation?

Answer

Capital income (corporate profits, dividends and capital gains) is taxed at the same rate as labor income.

A change in capital income tax rates does not change potential GDP.

An increase in capital income tax rates leads to a decrease in investment.

It's better for the economy to tax capital income rather than labor income.

All of the above are true.

Most of U.S. Federal government debt is held by

Answer a.

China

b.

Oil producing nations

c.

Japan

d.

United Kingdom

e.

U.S. entities

Explanation / Answer

increases, decreases

Capital income (corporate profits, dividends and capital gains) is taxed at the same rate as labor income.

U.S. entities

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