NGPF Taxes Quiz

What is the purpose of taxes?

• To fund unnecessary government projects

• To burden the citizens

• To generate revenue for the government

• To discourage economic growth

What are the different types of taxes?

• property tax, inheritance tax, excise tax

• payroll tax, estate tax, capital gains tax

• income tax, sales tax, property tax, corporate tax, excise tax

• value-added tax, import tax, gift tax

What is the difference between progressive and regressive taxes?

• Progressive taxes are based on the principle that individuals with lower incomes should pay a higher percentage of their income in taxes, while regressive taxes are based on the principle that individuals with higher incomes should pay a higher percentage of their income in taxes.

• Progressive taxes are based on the principle that individuals with higher incomes should pay a lower percentage of their income in taxes, while regressive taxes are based on the principle that individuals with lower incomes should pay a lower percentage of their income in taxes.

• Progressive taxes and regressive taxes are the same and have no difference in their principles.

• Progressive taxes are based on the principle that individuals with higher incomes should pay a higher percentage of their income in taxes, while regressive taxes are based on the principle that individuals with lower incomes should pay a higher percentage of their income in taxes.

How are income taxes calculated?

• Income taxes are calculated based on the number of dependents a person has.

• Income taxes are calculated by applying a tax rate to an individual's taxable income.

• Income taxes are calculated by subtracting expenses from income.

• Income taxes are calculated by multiplying the total income by a fixed amount.

Noah, Avery, and Grace are discussing taxes. Noah explains the concept of marginal tax rate. How does he describe it?

• Noah says, 'The concept of marginal tax rate is the highest tax rate that an individual pays on their income.'

• Noah says, 'The concept of marginal tax rate is the tax rate that is applied to the total income of an individual.'

• Noah says, 'The concept of marginal tax rate is the lowest tax rate that an individual pays on their income.'

• Noah says, 'The concept of marginal tax rate is the average tax rate that an individual pays on their income.'

Zoe has recently started working and she is confused about the terms gross income and net income. Can you explain to her the difference between gross income and net income?

• Gross income is the income Zoe would earn from investments, while net income is the income she would earn from her job.

• Gross income is the income Zoe would have after all deductions and taxes have been subtracted from her salary, while net income is the total income she would earn before any deductions or taxes are taken out.

• Gross income is the income Zoe would earn from self-employment, while net income is the income she would earn from a regular job.

• Gross income is the total income Zoe would earn before any deductions or taxes are taken out from her salary, while net income is the income remaining after all deductions and taxes have been subtracted.

Emma recently started her first job and her employer asked her to fill out a W-4 form. What is the purpose of this form?

• To track Emma's attendance at work

• To determine the amount of federal income tax to withhold from Emma's paycheck.

• To determine Emma's vacation days

• To calculate Emma's annual salary

Scarlett, Evelyn, and James are discussing their taxes. Scarlett says a tax deduction increases the amount of income that is subject to tax, while a tax credit directly increases the amount of tax owed. Evelyn thinks a tax deduction and a tax credit are the same thing. James believes a tax deduction reduces the amount of tax owed, while a tax credit reduces the amount of income subject to tax. However, Evelyn remembers reading that a tax deduction reduces the amount of income that is subject to tax, while a tax credit directly reduces the amount of tax owed. Who is correct?

• Scarlett is correct.

• Evelyn is correct when she says a tax deduction and a tax credit are the same thing.

• James is correct.

• Evelyn is correct when she remembers reading about the difference.

William, Avery, and Arjun are discussing their income taxes. They are confused about the concept of tax brackets. Can you explain it to them?

• Tax brackets are only applicable to individuals like William, Avery, and Arjun and do not apply to businesses or corporations.

• Tax brackets are fixed amounts of money that individuals like William, Avery, and Arjun must pay in taxes.

• Tax brackets are used to determine the amount of tax deductions an individual like William, Avery, or Arjun is eligible for.

• Tax brackets are ranges of income that determine the rate at which an individual like William, Avery, or Arjun is taxed.

James, Ava, and Grace are discussing their tax filings. James mentions some common tax deductions and credits. Which of the following did he likely mention?

• medical expense deduction

• student loan interest deduction

• standard deduction, child tax credit, earned income tax credit, mortgage interest deduction

• property tax deduction