3 main purposes tax: (just read)

taxes are necessary to fund the essential provisions of gov.

the primary goal for tax policy is to raise enough money for gov. to function effectively:

it's also the burden of policy makers to craft tax policy that is as fair as possible and disrupting the economy as little as possible:

includes pigovian taxes (activities that affect negatively the society)

some tax policies are designed to encourage desirable types of spending by taxing them at a lower rate, or not at all:

also provides tax breaks employers who provide health insurance and retirement benefits to workers by excluding the cost of the benefits from a firm's taxable income:

includes production of tobacco and alcohol:

ex: health insurance, work expenses, charitable donations:

discourage undesired behavior:

value of the activities or assets subject to the tax:

a specific percentage of the tax base that is paid in taxes:

a form you complete and submit to the government when you pay your income taxes:

a tax collected frim employers on the basis of the wages and salaries paid to workers, medicare:

income of individuals from all the sources:

the payment firms make to workers:

sales made by firms:

the value of property:

the profits corporations earn:

The combination of the tax base and tax rate determines the revenue collected from a particular tax (just read)

U.S's leading tax generator:

our income tax outpaces the total economy of all but 13 countries:

to encourage accuracy and honesty, the IRS conducts audits, examinations of tax records to make sure an individual or firm pay the correct amounts of tax:

errors can result in severe financial penalties:

second biggest in the U.S:

examinations of tax records to make sure an individual or firm pay the correct amount of tax:

when something is done more efficiently:

theory of trade. cheaper oppourtunity cost. applies to people, groups, and countries:

also known as law of association:

what are the ideal terms of trade, in the view of an economist? (just read)

(sources of comp. adv.) climate/ geography/ natural resources:

(sources of comp. adv.) factor proportions:

(sources of comp. adv.) increasing returns to scale/division of labor:

(sources of comp. adv.) increasing returns to scale/division of knowledge:

(sources of comp. adv.) institutions:

what is an economy of scale: (just read)

a tax on corporate profit that is paid directly by the corporation:

a required payment made by the owners of property, like land, buildings, boats, and cars:

applies to specific goods, like cigarettes and gasoline, and is typically assessed as a certain amount of money per unit, rather than a percentage of price:

typically sin tax:

collected from consumer by firms when a taxed good or service is purchased that money is then sent to the government:

to produce a disproportionate amount of that good or service for consumption and trade:

can take place at micro and macro level:

Why do people trade at all? (just read)

purchase of goods from another country:

selling goods to another country: