ECON MICRO
5th Edition
ISBN: 9781337000536
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 3, Problem 3.10P
To determine
The taxes for various income.
Introduction:
Progressive tax rate: It is defined as the system wherein taxes increase as the income increases, wherein high-income taxpayers pay more taxes as compared to the low-income taxpayers.
Regressive tax rate: It is defined as the system wherein the taxes decrease as the income increases, wherein high-income taxpayers pay fewer taxes as compared to low-income taxpayers
Proportionate tax rate: It is defined as the system wherein a flat tax rate is charged to all taxpayers irrespective of the income earned by them.
Marginal tax rate: The tax paid on an additional dollar of the income is termed as the Marginal tax rate. In other words, it is an incremental tax paid on the incremental income
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Qs 4: What is the meaning of the term ‘tax expenditure’?
11-The selling price of a product in Oman is higher than the price in Dubai although both products are having the same nature. Customers are buying the product from Dubai due to the price differences. What will be the effect of the customers buying the products from Dubai? (1) Due to this, appreciation in the value AED (United Arab Emirates Dirham) relative to OMR, (2) Due to this, depreciate in the value AED (United Arab Emirates Dirham) relative to OMR, (3) Product sold in Oman market will decrease and the retail price will go down, (4) Product sold in Oman market will decrease and the retail price will go up, (5) The demand for the product and prices will increase in Dubai
a. (2) and (3) only
b. (1), (2), (3), (4) and (5)
c. (1) and (2) only
d. (1), (3) and (5) only
13.
Federal revenue consists of taxes levied on:
personal income and sales.
both residents and non-residents.
both individuals and businesses.
estates and corporations.
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