Unit 4 Flashcard: Public Policy and The Economy

Front

What is the primary purpose of taxes in the United States?

Back

To fund government programs and services

Front

Which of the following is NOT one of the four principles of taxation? Stability, Certainty, Equity, Efficiency

Back

Stability

Front

What does the principle of equity in taxation mean?

Back

Taxes and their use should be fair and equal

Front

Which tax principle refers to using money wisely? Options: Convenience, Equity, Efficiency, Certainty

Back

Efficiency

Front

A progressive tax structure means:

Back

Higher income earners pay a higher percentage.

Front

Which of the following is an example of a regressive tax? Federal income tax, Property tax, Corporate income tax, Sales Tax

Back

Sales Tax

Front

What type of tax charges the same rate to all income levels? Options: Progressive, Proportional, Regressive, Direct

Back

Proportional

Front

What policy is used by the government to influence the economy through taxes and spending?

Back

Fiscal policy

Front

How does the Federal Reserve stabilize the money supply in the economy? Options: Trade restrictions, Tariffs, Budget cuts, Interest rates and flow of money

Back

Interest rates and flow of money

Front

What is the purpose of an easy-money policy by the Federal Reserve?

Back

To stimulate the economy by making loans more accessible