Question 1

A regressive tax places a greater burden on the affluent because the tax rate falls as taxable income rises.

Accepted Answer

A) True 
 B)False

Question 2

The general sales tax is a good example of a progressive tax.

Accepted Answer

A) True 
 B)False

Question 3

Fiscal stress refers to financial pressures placed on a government from factors such as revenue shortfalls, taxing, and spending limitations.

Accepted Answer

A) True 
 B)False

Question 4

Why have lotteries and legalized gambling gained favor in terms of sources of revenue? Describe the advantages and disadvantages of such a revenue source. Discuss and defend your position on whether states and localities should rely on such sources.

Accepted Answer

Lotteries and legalized gambling have ga...

Question 5

The Federal Government is always a reliable fiscal partner with the states.

Accepted Answer

A) True 
 B)False

Question 6

Financial pressure on a government from factors such as revenue shortfalls and taxing and spending limitations is generally referred to as

Accepted Answer

A)  monetary stress.
B)  fiscal stress.
C)  TELs.
D)  pass-through spending.

Question 7

States can improve the yield of the sales tax by broadening the base to include services and thus make the tax more equitable as upper-income individuals are heavier users of services. Which of the following examples is not an example of taxing a service?

Accepted Answer

A)  A tax when you repair of your automobile
B)  A tax when getting your hair cut
C)  A tax on the cost of having a tattoo applied to your arm
D)  A tax on the cost of buying cigarettes from a convenience store

Question 8

State lotteries are a fairly recent phenomenon and came about as a response to the fiscal stress of the 1970s and 1980s.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following bonds is issued to fund the construction of a facility to be used by a private firm?

Accepted Answer

A)  General-obligation bond
B)  Revenue bond
C)  Industrial development bond
D)  Excise bond

Question 10

In 2013, Congress passed the Marketplace Fairness Act, which placed a moratorium on taxing Internet transactions. The moratorium has now been lifted, and states are free to tax all items sold on the Internet under each state's sales tax rules.

Accepted Answer

A) True 
 B)False

Question 11

Current procedures for estimating state and local revenues as a basis for budget planning

Accepted Answer

A)  are unreliable, given the lack of data.
B)  are free of error now that highly reliable computers are available.
C)  rely on simply extrapolating from past trends.
D)  rely more and more on sophisticated econometric models made possible by computer technology.

Question 12

​Rapid and severe deterioration in revenues slammed state and local governments during the Great Recession.

Accepted Answer

A) True 
 B)False

Question 13

Tax effort depends largely on the scope and level of services desired by the citizens of that state or municipality.

Accepted Answer

A) True 
 B)False

Question 14

Taxing Internet sales

Accepted Answer

A)  remains insignificant to most states because it is too complicated for the stores to keep track of all 50 state laws on sales taxes. Sales on the Internet have been declining significantly in recent years.
B)  would generate close to $5 billion a year of additional sales tax revenues through online catalogue sales and perhaps $23 billion from Internet sales overall.
C)  has been a significant source of revenue since 1998 for forty-six states after the U.S. Supreme Court allowed North Dakota to become the first state to impose a tax on Internet sales.
D)  may never be a source of revenue for the states because the U.S. Congress passed a law that forbids state and local government from ever imposing a tax on sales transactions that occur on the Internet.

Question 15

Today, property taxes

Accepted Answer

A)  are the largest source of state government revenues.
B)  represent the largest component of New Hampshire's tax revenues and the smallest part of those revenues in Alaska.
C)  are easier to collect because the property never moves and its value seldom changes.
D)  are the largest source of local government revenues.

Question 16

Poor states, with low tax capacity, are forced to

Accepted Answer

A)  tax at a lower rate than wealthy states because there is less demand for basic services.
B)  tax at the same rate as wealthy states because tax capacity is not related to tax effort.
C)  exert less tax effort than wealthy states.
D)  tax at high rates just to pull in enough money to pay for basic governmental functions.

Question 17

Severance taxes, as a source of state revenues, are popular

Accepted Answer

A)  in states that have a lot of natural resources. They help keep income, property, and sales taxes relatively low and eventually those taxes are paid mostly by out-of-state users.
B)  with resource-rich states, but the rates are set by the national government.
C)  in states like Virginia and Washington, but they are unused in Alaska and Wyoming because the price of natural resources is constantly changing due to market conditions.
D)  because they exempt natives (in-staters) from the tax.

Question 18

What are the major services for which state and local governments spend the most money? What trends have taken place over the past ten years in terms of areas where spending is growing faster and slower than the average? What factors are influencing these trends? How does this impact taxpayers' willingness to raise or sustain revenues to pay for those programs and services?

Accepted Answer

The major services for which state and l...

Question 19

Evaluating tax options on the basis of political accountability means

Accepted Answer

A)  using a procedure known as bracket creep to ensure that taxpayers are aware of their liabilities.
B)  considering the ease with which the tax can be administered by a government using standard accounting methods.
C)  considering the degree to which the effects of a particular tax are made public by political decision makers.
D)  adjusting taxes as the economy heats up or cools down.

Question 20

Local governments can levy taxes and fees, incur debt, and spend money without state government authorization.

Accepted Answer

A) True 
 B)False

Exam 13: Taxing and Spending

The Federal Government is always a reliable fiscal partner with the states.

Correct Answer
verified

Financial pressure on a government from factors such as revenue shortfalls and taxing and spending limitations is generally referred to as

Correct Answer
verified

Taxing Internet sales

Correct Answer
verified

Correct Answer
Answered by ExamLex AI
The major services for which state and l...
View Answer

Which of the following bonds is issued to fund the construction of a facility to be used by a private firm?

Correct Answer
verified

A regressive tax places a greater burden on the affluent because the tax rate falls as taxable income rises.

Correct Answer
verified

Poor states, with low tax capacity, are forced to

Correct Answer
verified

In 2013, Congress passed the Marketplace Fairness Act, which placed a moratorium on taxing Internet transactions. The moratorium has now been lifted, and states are free to tax all items sold on the Internet under each state's sales tax rules.

Correct Answer
verified

Rapid and severe deterioration in revenues slammed state and local governments during the Great Recession.

Correct Answer
verified

Evaluating tax options on the basis of political accountability means

Correct Answer
verified

Today, property taxes

Correct Answer
verified

Severance taxes, as a source of state revenues, are popular

Correct Answer
verified

Local governments can levy taxes and fees, incur debt, and spend money without state government authorization.

Correct Answer
verified

Current procedures for estimating state and local revenues as a basis for budget planning

Correct Answer
verified

States can improve the yield of the sales tax by broadening the base to include services and thus make the tax more equitable as upper-income individuals are heavier users of services. Which of the following examples is not an example of taxing a service?

Correct Answer
verified

State lotteries are a fairly recent phenomenon and came about as a response to the fiscal stress of the 1970s and 1980s.

Correct Answer
verified

Why have lotteries and legalized gambling gained favor in terms of sources of revenue? Describe the advantages and disadvantages of such a revenue source. Discuss and defend your position on whether states and localities should rely on such sources.

Correct Answer
Answered by ExamLex AI
Lotteries and legalized gambling have ga...
View Answer

Tax effort depends largely on the scope and level of services desired by the citizens of that state or municipality.

Correct Answer
verified

Fiscal stress refers to financial pressures placed on a government from factors such as revenue shortfalls, taxing, and spending limitations.

Correct Answer
verified

The general sales tax is a good example of a progressive tax.

Correct Answer
verified

Exam 13: Taxing and Spending

The Federal Government is always a reliable fiscal partner with the states.

Correct AnswerverifiedShow Answer

Financial pressure on a government from factors such as revenue shortfalls and taxing and spending limitations is generally referred to as

Correct AnswerverifiedShow Answer

Taxing Internet sales

Correct AnswerverifiedShow Answer

Correct AnswerAnswered by ExamLex AIThe major services for which state and l...View AnswerShow Answer

Which of the following bonds is issued to fund the construction of a facility to be used by a private firm?

Correct AnswerverifiedShow Answer

A regressive tax places a greater burden on the affluent because the tax rate falls as taxable income rises.

Correct AnswerverifiedShow Answer

Poor states, with low tax capacity, are forced to

Correct AnswerverifiedShow Answer

In 2013, Congress passed the Marketplace Fairness Act, which placed a moratorium on taxing Internet transactions. The moratorium has now been lifted, and states are free to tax all items sold on the Internet under each state's sales tax rules.

Correct AnswerverifiedShow Answer

​Rapid and severe deterioration in revenues slammed state and local governments during the Great Recession.

Correct AnswerverifiedShow Answer

Evaluating tax options on the basis of political accountability means

Correct AnswerverifiedShow Answer

Today, property taxes

Correct AnswerverifiedShow Answer

Severance taxes, as a source of state revenues, are popular

Correct AnswerverifiedShow Answer

Local governments can levy taxes and fees, incur debt, and spend money without state government authorization.

Correct AnswerverifiedShow Answer

Current procedures for estimating state and local revenues as a basis for budget planning

Correct AnswerverifiedShow Answer

States can improve the yield of the sales tax by broadening the base to include services and thus make the tax more equitable as upper-income individuals are heavier users of services. Which of the following examples is not an example of taxing a service?

Correct AnswerverifiedShow Answer

State lotteries are a fairly recent phenomenon and came about as a response to the fiscal stress of the 1970s and 1980s.

Correct AnswerverifiedShow Answer

Why have lotteries and legalized gambling gained favor in terms of sources of revenue? Describe the advantages and disadvantages of such a revenue source. Discuss and defend your position on whether states and localities should rely on such sources.

Correct AnswerAnswered by ExamLex AILotteries and legalized gambling have ga...View AnswerShow Answer

Tax effort depends largely on the scope and level of services desired by the citizens of that state or municipality.

Correct AnswerverifiedShow Answer

Fiscal stress refers to financial pressures placed on a government from factors such as revenue shortfalls, taxing, and spending limitations.

Correct AnswerverifiedShow Answer

The general sales tax is a good example of a progressive tax.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
Answered by ExamLex AI
The major services for which state and l...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Rapid and severe deterioration in revenues slammed state and local governments during the Great Recession.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
Answered by ExamLex AI
Lotteries and legalized gambling have ga...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified