Unit 12 Practice Test

Which term refers to the amount by which government spending exceeds its revenue?

• Deficit

• Surplus

• Bond

If a government spends less than it collects in revenue, what is this situation called?

• Surplus

• Deficit

• Bond

At which levels do taxes occur?

• Only at the federal level

• Only at the state level

• At the federal, local, and state levels

• Only at the local level

Why does the government collect taxes, based on the lesson?

• To pay for its many functions

• To increase the population

• To reduce the number of businesses

According to the 2023 tax brackets for single people, what is the tax rate for someone earning $50,000?

• 22%

• 12%

• 24%

In a proportional tax system, how does the percent of income paid in taxes change as income increases?

• It increases

• It decreases

• It stays the same

• It fluctuates randomly

Which of the following is a way the federal government can earn revenue that is not available to other levels of government?

• Imposing tariffs on imports

• Collecting sales taxes

• Issuing parking tickets

Which of the following best describes mandatory spending by the government?

• Spending that the government can choose to increase or decrease each year

• Spending that is required by law and committed to by the government

• Spending only on military and defense

Based on the pie chart, what percentage of federal spending in 2022 was categorized as discretionary?

• 15%

• 27%

• 73%

What does the term "debt ceiling" refer to in the context of the U.S. federal government?

• The maximum amount of money the government can spend in a year

• The limit on how much the federal government can borrow at one time

• The total amount of taxes collected in a year