Test Bank For Principles of Taxation for Business and Investment Planning 2024 Edition, 27th Edition All Chapters - 9781265674090

DOWNLOAD THE Test Bank for Principles of Taxation for Business and Invest
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ment Planning 20th Edition Jones
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Chapterc02c-cPolicycStandardscforcacGoodcTax



Chapter 02 Po c c


licy Standards for a Good Tax
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Truec/cFalsecQuestions



1. Actaxcmeetscthecstandardcofcsufficiencycifcitcisceasycforcpeoplectocpaycthectax.cTr
ue False



2. Thecfederalcgovernmentciscnotcrequiredctocpaycinterestconcthecnationalcdebt.cT
rue False



3. Acstaticcforecastcofcthecrevenueceffectcofcactaxcratecchangecassumescthatcthectaxcbasecdoescnotcch
ange.
True False



4. Acdynamiccforecastcofcthecrevenueceffectcofcactaxcratecchangecassumescthatcthectaxcbasecdoescno
tcchange.
True False



5. ThecfederalcSocialcSecurityctaxcburdenconcemployeeschascnotcincreasedcsincec1990cbecausecth
ectaxcratechascnotcincreasedcsincecthatcyear.
True False



6. IfcStatecHcincreasescitscsalesctaxcratecbyc1%,citscsalesctaxcrevenuecmustcalsocincreasecbyc1%.cTr
ue False




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HillcEducation.

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,DOWNLOAD THE Test Bank for Principles of Taxation for Business and Invest
c c c c c c c c c c c

ment Planning 20th Edition Jones
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Chapterc02c-cPolicycStandardscforcacGoodcTax




7. TheccitycofcBernecrecentlycenactedcac10%ctaxconcthecpricecofcacsubwaycticket.cConsequently,cM
rs.cLanecnowcwalksctocworkcinsteadcofctakingcthecsubway.cHercbehaviorcillustratescthecsubstitutio
nceffectcofcactaxcincrease.
True False



8. JurisdictioncPcrecentlycincreasedcitscincomectaxcrate.cActaxpayercwhocreactsctocthecincreasecbycw
orkingcharderctocearncmorecincomeciscdemonstratingcthecincomeceffectcofcthecratecincrease.cTrue
False



9. Accordingctocsupply-sidececonomicctheory,cacdecreasecinctaxcratescforchigh-
incomecindividualsccouldcactuallyccausecancincreasecinctaxcrevenue.
True False



10. Supply-
sidececonomicctheorycholdscthatcpeoplecwhocbenefitcfromcactaxcratecreductioncwillcspendctheircta
xcwindfallconcconsumptioncgoods.
True False



11. Statecusectaxescarecmorecconvenientcforcindividualcconsumerscthancstatecsalesctaxes.cT
rue False



12. ThecInternalcRevenuecService'sccostcofccollectingc$100cofctaxcrevenueciscaboutc$3.cT
rue False



13. Acconvenientctaxchasclowccomplianceccostscforctaxpayerscandclowccollectioncandce
nforcementccostscforcthecgovernment.
True False




2-2
Copyrightc©c2017cMcGraw-HillcEducation.c Allcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-
HillcEducation.

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ment Planning 20th Edition Jones
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Chapterc02c-cPolicycStandardscforcacGoodcTax




14. Accordingctocthecclassicalcconceptcofcefficiency,cancefficientctaxcshouldcbecneutralcincitscef
fectconcfreecmarketcallocationscofceconomiccresources.
True False



15. AccordingctocthecKeynesiancconceptcofcefficiency,cancefficientctaxcshouldcbecneutralcincitscef
fectconcfreecmarketcallocationscofceconomiccresources.
True False



16. Actaxcmeetscthecstandardcofcefficiencycifcitcgeneratescenoughcrevenuectocpaycforcthecpubliccgo
odscandcservicescprovidedcbycthecgovernment.
True False



17. Acprovisioncincthectaxclawcdesignedctocencouragecacspecificceconomiccbehaviorciscactaxcpr
eference.
True False



18. Acgoodctaxcshouldcresultcinceitherchorizontalcorcverticalcequitycacrossctaxpayers.cT
rue False



19. Changescincthectaxclawcintendedctocmakecthecmeasurementcofctaxablecincomecmorecprecisecus
uallycmakecthectaxclawclessccomplex.
True False



20. Verticalcequitycfocusesconcmeasurementcofcthectaxcbase,candchorizontalcequitycfocusesconcth
ectaxcratecstructure.
True False




2-3
Copyrightc©c2017cMcGraw-HillcEducation.c Allcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-
HillcEducation.

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, DOWNLOAD THE Test Bank for Principles of Taxation for Business and Invest
c c c c c c c c c c c

ment Planning 20th Edition Jones
c c c c




Chapterc02c-cPolicycStandardscforcacGoodcTax




21. Taxcsystemscwithcregressivecratecstructurescresultcincacproportionallycheavierctaxcburdenconcp
ersonscwithcsmallerctaxcbases.
True False



22. Acprogressivecratecstructurecandcacproportionatecratecstructurecbothcresultcincverticalcequityca
crossctaxpayers.
True False



23. ThecU.S.cindividualcincomectaxchascalwayscusedcacprogressivecratecstructure.cT
rue False



24. Thecdecliningcmarginalcutilitycofcincomecacrosscindividualsccancbecmeasuredcempirically.cT
rue False



25. Taxcliabilitycdividedcbyctaxablecincomecequalscmarginalctaxcrate.c
True False



26. Ifcactaxchascacproportionatecratecstructure,cactaxpayer'scmarginalcratecandcaveragecratecareceq
ual.
True False



27. Ifcactaxchascacprogressivecratecstructure,cactaxpayer'scaveragecrateciscgreatercthanchercmarginalcrat
e.
True False



28. Thectheorycofcdistributionalcjusticeciscacrationalecforcacprogressivecincomectaxcsystem.cT
rue False



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Copyrightc©c2017cMcGraw-HillcEducation.c Allcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-
HillcEducation.

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