The Federal individual income tax has personal exemptions, so that low-income fa

Question

The Federal individual income tax has personal exemptions, so that low-income families do not pay income taxes. The income tax also has graduated marginal rates, so that the tax rate on an ditional dollar of taxable income becomes larger as incomes rise. Because of these features, the ome tax is a. a cartel. b. regressive. c. proportional. d. progressive. e. a tax that raises zero revenue A point that is up and to the right from the production-possibilities frontier is a. associated with inefficient use of the available resources. b. associated with efficient use of the available resources. c. unattainable with the resources that are currently available. d. all of the above. e. none of the above A tariff leads to an increase in the price of imported cheese. Because of this, the consumers in the porting country are harmed. What is our best way of measuring the value of the consumers' loss? a. The decrease in the quantity of imports. b· The decrease in consumer surplus. c. The increase in the gross-of-tariff price of imports. d. All of the above. e. None of the above. As we move from left to right along a diagram of the short-run cost curves of a business firm, what ppens to the vertical distance between the average-total-cost curve (ATC) and the average-variable- st curve (AVC)? a. The distance becomes greater. b. The distance stays the same. c. The distance becomes smaller. d· The distance becomes smaller until the AVC curve reaches its minimum point, but then comes larger. The distance becomes smaller until the ATC curve reaches its minimum point, but then e. omes larger

Explanation / Answer

1) When the tax rate increases with the rise in income , the tax is recognised as a progressive tax.

Hence option D)

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