Problem 4
How does demand elasticity influence the incidence of a tax?
Problem 4
How are excise taxes and customs duties similar? How are they different?
Problem 5
Why do local governments need tax assessors?
Problem 5
What is the purpose of a tax incentive?
Problem 7
In \(2005,\) the 10 percent tax bracket limit was \(\$ 7,300 .\) In \(2006,\) it increased to \(\$ 7,550 .\) By what percentage did the tax bracket limit increase? How does this example illustrate the concept of indexing?
Problem 7
Colorado has a state income tax of 4.63 percent on all income and a sales tax of 2.9 percent. Are these taxes proportional, progressive, or regressive? Give reasons for your answers.
Problem 8
The Social Security tax rate for employees is 6.2 percent, and the Medicare tax rate is 1.45 percent. Are both parts of the FICA tax proportional? Give reasons for your answer.
Problem 8
In \(2005,\) Hurricane Katrina destroyed many homes and businesses along the Gulf Coast of the United States. How did this natural disaster affect the tax bases in communities in that region?
Problem 8
Categorize each of these examples of federal spending as direct spending, transfer payment, or grant-in-aid: \(\bullet\) computers for IRS \(\bullet\) disability benefits \(\bullet\) flood control in Gulf Coast region \(\bullet\) highway funds for states \(\bullet\) medical care for elderly \(\bullet\) money for urban housing \(\bullet\) price supports for farmers \(\bullet\) repair of space shuttle \(\bullet\) salaries for national park rangers
Problem 8
Which level of government would be most affected if the federal government decided to limit the amount of money that it spent on the Medicaid program? Give reasons for your answer
