How is the national debt different from the deficit?

Annual deficits contribute to the total debt

The debt and deficit are the same thing

Debts contribute to annual deficits

Debts are smaller than deficits

Fiscal policy can be defined as

the use of government taxing and spending to stabilize the economy.

congressional laws designed to increase unemployment.

the use of quotas to control inflation.

How does the information on your W-4 form affect how much you will owe in taxes?

Employers use the information on the W-4 to determine how much income tax should be deducted from each paycheck.

Employers will use this information to decide if you should receive unemployment benefits.

Employers will use this information to compute your annual tax refund.

Employees who do not complete the form are not eligible to claim the standard deduction on their taxes.

What impact do expansionary fiscal policies tend to have on the national budget?

They balance the annual budget.

Which of the following individuals will NOT be required to file taxes with the IRS at the end of the year?

Joanne, a 17-year-old who works part time and earned $5,000 this year

Howard, a married father of two who earned $98,000 this year

Louise, a single mother who works part time and earned $35,000 last year

Jeffrey, a freelance photographer who earned $78,000 and reports all of his income through 1099's

What is the benefit of having pre-tax contributions (such as health insurance and retirement) deducted from your paycheck?

These contributions are subtracted from your taxable income, which means you will not pay income tax on these contributions this year.

Your employer will pay 100% of your health insurance deductible.

You will get a refund on these expenses if you leave your job before the end of the year.

Your employer cannot fire you if your opt for pre-tax contributions to healthcare.

You work part time and earn $500 month. After taxes are deducted, the amount on your paycheck is $425. Which of the following statements about your earnings is true?

Your gross pay is $500 and your net pay is $425.

Your net pay is $500 and your gross pay is $425.

Your gross pay is $500 and your net pay is $75.

Your gross pay and your net pay are $425

What impact do contractionary fiscal policies tend to have on the national budget?

They balance the annual budget.

Why is it essential to write a business plan for a new business idea?

It can help you get funding from potential investors and partners.

It provides a guarantee that your business will be a success.

It is a legal requirement in most states.

How does crowdfunding differ from investor funding?

Crowdfunding raises funds through many small micro-donations, investors generally contribute more finances in exchange for a future share of the businesses.

Crowdfunding donors will expect to have an eventual stake in your businesses, but investors are rarely involved in the businesses.

Crowdfunding involves getting a few large monetary contributions, but investors generally contribute with micro-donations.

Crowdfunding and investor funding are nearly identical, as both involve giving up some control of your businesses.

Why might someone choose to organize their business as a sole proprietorship?

It offers a chance to be your own boss and make independent decisions.

Sole proprietorship are the most profitable business organization.

Sole proprietorships have the least difficulty raising funds.

Sole proprietorship have limited liability for the firm's debts.

Which of the following statements about franchises is true?

Franchisees benefit from immediate brand recognition and and established business model.

Franchise owners have a good amount of creative freedom when it comes to running the business

Franchises require a very small initial investment and are inexpensive to maintain

Franchisees have complete control over major decisions about how the business is run.

What is one major impact of inflation?

The purchasing power of the dollar decreases.

The purchasing power of the dollar increases.

Both nominal and real wages increase.

Which of the following is the best description of a "lifestyle entrepreneur?"

An entrepreneur who has monetized a hobby or interest

An entrepreneur who invents something new

An entrepreneur who specializes in starting a new business idea, then sells it and move on the next idea

An entrepreneur who sells products in a store

What actions would the government take to pursue an expansionary fiscal policy?

Decrease taxes and increase government spending

Decrease both taxes and government spending

Increase both taxes and government spending

Increase taxes and decrease government spending

What actions would the government take to pursue a contractionary fiscal policy?

Increase taxes and decrease government spending

Decrease taxes and increase government spending

Decrease both taxes and government spending

Increase both taxes and government spending

What is the main difference between a tax deduction and a tax credit?

A deduction reduces taxable income, a credit reduces the total tax owed directly (dollar-for-dollar).

A deduction is a reduction of tax debt, a credit depends on your tax bracket.

Both reduce taxable income, but credits are only available to those in lower tax brackets

A deduction reduces the total tax owed directly (dollar-for-dollar), a credit reduces taxable income.

What is the benefit of organizing a business as a corporation?

Owners have limited liability for for the firm's debts

Corporations are simple to establish

Shareholders make important decisions about day-to-day business activities

Owners enjoy the independence of being their own boss and making the decisions

Why might someone choose to buy a franchise, rather than start a business from scratch?

The owner benefits from instant brand recognition among their customers.

It is very inexpensive to invest in most franchises.

The owner will have extensive creative freedom in running the business.

There are ongoing fees or expenses associated with running a franchise.

Which of the following is a business owner allowed to deduct on their Schedule C to determine their Net Profit?

Portion of rent/mortgage & utilities used at home for business

Business related travel and 50% of business meal costs

Any income earned as an Entrepreneur

The standard deduction of $16,100

What is one benefit of organizing your business as an LLC?

LLC's protect the owners from liability for the firm's debts.

LLC's allow the owner to raise money by selling shares of stock.

Once an LLC is established, the owners do not have to file paperwork or tax documents to maintain the LLC.

Personal Finance Unit 2 Review (Fall 26)

Authored by Jennifer Verdugo

Social Studies

12th Grade

Used 1+ times

Personal Finance Unit 2 Review (Fall 26)

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45 questions

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MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following describes a regressive tax?

A tax that takes a higher percentage of income from those who earn more

A tax that takes the same percentage of all incomes

A tax that takes a higher percentage of income from those who earn less

A tax based on receiving the benefits of a particular good or service

Answer explanation

MOST taxes in the US are regressive.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following describes a progressive tax?

A tax that takes a higher percentage of income from those who earn more

A tax that takes the same percentage of all incomes

A tax that takes a higher percentage of income from those who earn less

A tax based on receiving the benefits of a particular good or service

Answer explanation

Progressive income taxes are based on the Ability to Pay principal of fairness.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following taxes pays for Social Security and Medicare?

Federal Income Tax

Sales Tax

FICA/Payroll Tax

Excise Taxes

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which tax is the largest source of revenue for most cities?

Corporate income taxes

Sale taxes

Individual Income taxes

Property Taxes

Answer explanation

In the state of Texas, schools are funded by property taxes.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which tax structure is the Sales Tax?

Progressive

Regressive

Proportional

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which Principal of Fairness applies to the Corporate Income Tax?

Ability to Pay

Benefits Received

Ability to Consume

Answer explanation

Progressive Income taxes are based on the Ability to Pay principal of fairness.
The Ability to Pay principal says that those with higher incomes have the ability to pay more.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is an example of a transfer payment?

Uniforms for military officers

A new statue in a public park

An unemployment check

A senator's salary

Answer explanation

When the government gives money to a household or a business without getting anything in return, it is a transfer payment -- money is being transferred to those who need it.
Many social programs (Unemployment, Social Security, Medicaid) are examples of transfer payments.

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Personal Finance Unit 2 Review (Fall 26)

Which of the following describes a regressive tax?

MOST taxes in the US are regressive.

Which of the following describes a progressive tax?

Progressive income taxes are based on the Ability to Pay principal of fairness.

Which of the following taxes pays for Social Security and Medicare?

Which tax is the largest source of revenue for most cities?

In the state of Texas, schools are funded by property taxes.

Which tax structure is the Sales Tax?

Which Principal of Fairness applies to the Corporate Income Tax?

Progressive Income taxes are based on the Ability to Pay principal of fairness.
The Ability to Pay principal says that those with higher incomes have the ability to pay more.

Which of the following is an example of a transfer payment?

When the government gives money to a household or a business without getting anything in return, it is a transfer payment -- money is being transferred to those who need it.
Many social programs (Unemployment, Social Security, Medicaid) are examples of transfer payments.

How is the national debt different from the deficit?

Each year the government runs a deficit budget, it must borrow to cover the hole, and that adds to the debt.
Each deficit CONTRIBUTES to the debt. The debt is the total of ALL the deficits that have added up over several years.

All of the following are entitlements EXCEPT

Entitlements are social programs that people are entitled to receive if they qualify.
The three biggest entitlement programs are Social Security, Medicare and Medicaid.

Who carries out Fiscal Policy?

Access all questions and much more by creating a free account

Popular Resources on Wayground

Discover more resources for Social Studies

Personal Finance Unit 2 Review (Fall 26)

Which of the following describes a regressive tax?

MOST taxes in the US are regressive.

Which of the following describes a progressive tax?

Progressive income taxes are based on the Ability to Pay principal of fairness.

Which of the following taxes pays for Social Security and Medicare?

Which tax is the largest source of revenue for most cities?

In the state of Texas, schools are funded by property taxes.

Which tax structure is the Sales Tax?

Which Principal of Fairness applies to the Corporate Income Tax?

Progressive Income taxes are based on the Ability to Pay principal of fairness.The Ability to Pay principal says that those with higher incomes have the ability to pay more.

Which of the following is an example of a transfer payment?

When the government gives money to a household or a business without getting anything in return, it is a transfer payment -- money is being transferred to those who need it.Many social programs (Unemployment, Social Security, Medicaid) are examples of transfer payments.

How is the national debt different from the deficit?

Each year the government runs a deficit budget, it must borrow to cover the hole, and that adds to the debt.Each deficit CONTRIBUTES to the debt. The debt is the total of ALL the deficits that have added up over several years.

All of the following are entitlements EXCEPT

Entitlements are social programs that people are entitled to receive if they qualify. The three biggest entitlement programs are Social Security, Medicare and Medicaid.

Who carries out Fiscal Policy?

Access all questions and much more by creating a free account

Popular Resources on Wayground

Discover more resources for Social Studies

Progressive Income taxes are based on the Ability to Pay principal of fairness.
The Ability to Pay principal says that those with higher incomes have the ability to pay more.

When the government gives money to a household or a business without getting anything in return, it is a transfer payment -- money is being transferred to those who need it.
Many social programs (Unemployment, Social Security, Medicaid) are examples of transfer payments.

Each year the government runs a deficit budget, it must borrow to cover the hole, and that adds to the debt.
Each deficit CONTRIBUTES to the debt. The debt is the total of ALL the deficits that have added up over several years.

Entitlements are social programs that people are entitled to receive if they qualify.
The three biggest entitlement programs are Social Security, Medicare and Medicaid.