Question

In: Economics

Because the income tax structure is progressive, the amount of taxes paid is a _____. a....

Because the income tax structure is progressive, the amount of taxes paid is a _____.

a.

​ decreasing function of income in both expansions and contractions
b.

​ constant fraction of income throughout the business cycle
c.

​ constant amount at all levels of output and income
d.

​ smaller fraction of income in expansions than in contractions
e.

​ larger fraction of income in expansions than in contractions

Solutions

Expert Solution

Option e

the larger fraction of income in expansions than in contractions

The progressive tax rate increases as the income increase so the higher the income the higher the taxes but it increases by the step function so the larger fraction of income in expansions than in contractions as the income increases in the expansion and decreases in the contraction.

Rahul Sunny answered 2 years ago
Next > < Previous

Related Solutions

Because the income tax structure is progressive, the amount of taxes paid is a _____. a....
Because the income tax structure is progressive, the amount of taxes paid is a _____. a. smaller fraction of income in expansions than in contractions b. decreasing function of income in both expansions and contractions c. larger fraction of income in expansions than in contractions d. constant fraction of income throughout the business cycle e. constant amount at all levels of output and income
Are Social Security taxes progressive, regressive or proportional? Is federal income tax progressive, regressive or proportional?...
Are Social Security taxes progressive, regressive or proportional? Is federal income tax progressive, regressive or proportional? Why? What about the tax system as whole, is it progressive, regressive or proportional? Why?
MPQ: Different Types of Taxes a. A progressive tax is one in which
MPQ: Different Types of Taxesa. A progressive tax is one in whichthe average rate increases as income increases.the average rate decreases as income increases.the average rate is constant as income increases.more taxes are paid as income increases.b. A regressive tax is one in whichthe average rate decreases as income increases.the average rate is constant as income increases.the same taxes are paid as income increases.the average rate increases as income increases.c. A proportional tax is one in whichthe average rate decreases...
Ask the user for W2 income amount, any interest, deduction and paid tax amount.
Ask the user for W2 income amount, any interest, deduction and paid tax amount. Calculate the actual tax amount based upon the given income and data . Continuously ask the user to enter another set of data until the user chooses to exit the programRequirements: 1. The program must produce similar output. 2. The tax rate is 25% for total income that is less than or equal 10000 and 50% otherwise. 3. The tax amount is calculated based upon the actual income (income...
Use the following information to calculate cash paid for income taxes: Income Tax Expense $ 65,000...
Use the following information to calculate cash paid for income taxes: Income Tax Expense $ 65,000 Income Tax Payable, January 1 24,000 Income Tax Payable, December 31 14,500 Multiple Choice $65,000. $89,000. $79,500. $55,500. $74,500. A manufacturer reports the following costs to produce 24,000 units in its first year of operations: Direct materials, $24 per unit, Direct labor, $20 per unit, Variable overhead, $216,000, and Fixed overhead, $288,000. Of the 24,000 units produced, 23,200 were sold, and 800 remain in...
What is a progressive income tax system and how can an income tax system be structured...
What is a progressive income tax system and how can an income tax system be structured so that it is progressive?
The making investment decisions, we focus on after-tax cash flow’s because A. Taxes must be paid...
The making investment decisions, we focus on after-tax cash flow’s because A. Taxes must be paid B. Those are the cash flows available to shareholders C. Taxes have a significant effect on profits D. Tax rates differ across companies
Taxes: The Internal Revenue Service reports that the mean federal income tax paid in the year...
Taxes: The Internal Revenue Service reports that the mean federal income tax paid in the year 2010 was $8040 . Assume that the standard deviation is $4700 . The IRS plans to draw a sample of 1000 tax returns to study the effect of a new tax law. (a) What is the probability that the sample mean tax is less than $8000 ? Round the answer to at least four decimal places. The probability that the sample mean tax is...
Where do I find income tax expense and cash paid for taxes on a profit and...
Where do I find income tax expense and cash paid for taxes on a profit and loss statement that's part of a 10-K? Can an example be provided from an SEC company?
Taxes: The Internal Revenue Service reports that the mean federal income tax paid in the year...
Taxes: The Internal Revenue Service reports that the mean federal income tax paid in the year 2010 was $8040. Assume that the standard deviation is $490. The IRS plans to draw a sample of 1000 tax returns to study the effect of a new tax law. Part 1 of 5 (a) What is the probability that the sample mean tax is less than $8200? Round the answer to at least four decimal places. The probability that the sample mean tax...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT