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The sales tax on a $20 hammer is 7 percent, or $1.40. Why is this tax a bigger burden for Josh, who has a $15,000 income, than for Aaron, who has a $150,000 income?
Josh will have to pay a greater property tax on the hammer than will Aaron.
The tax represents a larger proportion of Josh's income.
The burden is the same for both Josh and Aaron.
The tax rate is higher for Josh than for Aaron.
13. The form used to file income taxes is a _____.
tax
return
personal exemption
deduction
withholding
14. Because trade and commerce are considered national enterprises, states _____.
cannot tax imports or exports
can tax imports and exports
can only tax exports
can only tax imports
15. Which of the following would be a progressive tax?
All people pay a 15 percent income tax.
People earning $35,000 pay 10 percent tax, while people earning $100,000 pay 30 percent tax.
Everyone
pays a 5 percent sales tax.
People pay 10 percent tax on property, whether it is worth $50,000, $500,000, or $50 million.
16. The statement "state regulators inspect water supplies and test for pollution" addresses how states dedicate tax revenue toward _____.
education
arts and recreation
highways and transportation
public welfare
17. The Constitution defines all of the following as limits of the government's power to tax except that _____.
Congress cannot tax church services
federal taxes must be the same in every state
the purpose of federal taxes is for the common defense and general welfare of the nation
the federal government is authorized to tax imports and exports
18. Congress is not authorized to reduce the cost of entitlement programs by _____.
introducing new laws that change benefits
controlling the number of people who are eligible for benefits
changing eligibility requirements
for benefit recipients
reducing the amount of benefits
19. Spending on certain programs that is required by existing law is referred to as _____.
discretionary spending
mandatory spending
Medicaid
an entitlement
20. Most federal mandatory spending is spent on _____.
entitlements
salaries for people in the federal government
defense
interest on the national debt