Briefly explain whether each of the following statements is true or false 5. There is no limit to the real seigniorage revenues governments can obtain by printing money to pay for public expenditure.
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Briefly explain whether each of the following statements is true or false
5. There is no limit to the real seigniorage revenues governments can obtain by printing money to pay for public expenditure.
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- Briefly explain the purpose served by payroll taxes and how they are collected. Describe any comment that economists point out with regard to payroll taxes.What is the effect of government purchased and taxation on the level of income?What is the difference between indirect taxes and net indirect taxes? Macro economics
- The Federal Budget- Ask FRED The accompanying graph contains data on "U.S Individual Income Tax: Tax Rates for Regular Tax: Highest Bracket'" reproduced in the accompanying graph to analyze this aspect of the U.S. tax system_ over the past 100 vears. FREDU.S Individual Income Tax: Tax Rates for Regular Tax: Highest Bracket 100 90 80 70 60 50 a 40 30 20 10 0 1920 1940 1960 1980 2000 Source: U.S. Department of the Treasury. Internal Revenue Service a. When the income tax was first introduced, what was the rate on the highest bracket?What is the difference between an expenditure (cash-flow) tax and a sales tax? What is the difference between an expenditure tax (cash-flow) and an income tax?4. The Laffer curve Government-imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections. To understand the effect of such a tax, consider the monthly market for cigarettes, which is shown on the following graph. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per pack) 20 18 16 14 Supply Demand 0 20 40 60 80 100 120 140 160 180 200 QUANTITY (Packs) Suppose the government imposes a $4-per-pack tax on suppliers. At this tax amount, the equilibrium quantity of cigarettes is Graph Input Tool Market for Cigarettes Quantity (Packs) Demand Price (Dollars per pack) Tax (Dollars per pack) 80 12.00 4.00 Supply Price (Dollars per pack) packs, and the government collects $ (?) 8.00 in tax revenue.
- New York has the highest cigarette taxes in the country. The price of an average pack of cigarettes in New York City is $10.60. The combined state and city taxes are $5.95 a pack. The average income of smokers is less than that of non-smokers Draw a graph to show the effects of the $5.95 tax on the buyer's price, the seller's price, the quantity of cigarettes bought, and the tax revenue. Does the buyer or seller pay more of the tax? Why? The graph shows the market for cigarettes with no tax. Draw a point to show the market equilibrium quantity and price. Label it 1. Draw a line that shows how a $6 per pack tax changes the supply of cigarettes. Label it S+ tax. Draw a point at the new equilibrium quantity to show the price paid by buyers. Label it 2. Draw a point at the new equilibrium quantity to show the price received by the seller. Label it 3. Draw a shape that represents the tax revenue received by the government. The pays more of the tax because OA. buyer; sellers can always pass…Income Consumption Sales Tax $10,000 $11,000 20,000 20,000 40,000 80,000 36,000 60,000 b. This sales tax is O proportional. O regressive. O progressive. Percentage of Income Paid in TaxesUse information from paragraph 4 to answer the following question. Before the Progressive Era, many taxes had been based on property. But many wealthy people hid such property as stocks and bonds from the govemment and did not pay taxes on them. Largely for this reason, progressives demanded that taxes be based on income rather than on property. In 1911, Wisconsin passed the first effective state income tax law. Two years later, Congress enacted what became the first permanent federal income tax in the United States. Which conclusion about taxation during the Progressive Era is best supported by the text? O Progressives demanded that taxes be based on income rather than on property. O Property taxes included ownership of stocks and bonds, which are inescapable today. O Property taxes were an ineffective means for the government to collect the money it needed to operate. O Progressives managed to pass the first state income tax, which was two years before the federal law was passed. 7 8…
- Illustrate each of the following situations with a graph showing IS curve: a. An increase in government spending b. An increase in taxesUse a circular flow diagram to illustrate how the allocation of resources is affected by government’s revenue and expenditure decisions.4. The Laffer curve Government imposed taxes cause reductions in the activity that is being taxed, which has important implications for revenue collections. To understand the effect of such a tax, consider the monthly market for champagne, which is shown on the following graph. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. BRUNENSE 8 5 1000 Suppose the government imposes a $10-per-case tax on suppliers. At this tax amount, the equilibrium quantity of champagne is - 700 400 500 430 300 200 100 1000 Now calculate the government's tax revenue if it sets a tax of $0, $10, $20, $25, $30, $40, or $50 per case. (Hint: To find the equilibrium quantity after the tax, adjust the "Quantity"field until the Tax equals the value of the per-unit tax.) Using the data you generate, plot a…