Chapter 7 2

Question 1

What percentage of federal revenues comes from individual income taxes?

Answer 1

47%

Question 2

Which federal taxes are considered progressive? Why are they so called?

Answer 2

• income taxes.

- the more you make, the bigger percentage of money you pay

Question 3

Which federal taxes are considered regressive? Why are they so called?

Answer 3

• payroll tax (social income taxes)

- it effects the poor more because every one pays the same amount no matter how much you make

Question 4

What is the purpose of the social insurance taxes?

Answer 4

• to provide general welfare

- it is a safety net for old people. No one will live under a certain amount of income

Question 5

Why does the government tax for non-revenue purposes?

Answer 5

-to discourage people from “bad” things, such as alcohol and cigarettes

Question 6

What are five sources of non-tax revenue of the federal government?

Answer 6

• savings bonds
• treasury bills
• printing money
• passport fees
• bus fees

Question 7

What is the current federal deficit?

Answer 7

-445 billion

Question 8

What is the current federal/national debt?

Answer 8

18.9 trillion

Question 9

What are the government’s four largest expenditures?

Answer 9

• medicare/caid
• social security
• defense/war
• income security

Question 10

What percentage of the federal budget consists of mandatory spending?

Answer 10

-69%

Question 11

What are the government’s four greatest sources of revenue?

Answer 11

• individual income tax
• corporate income tax
• social insurance and retirement receipts (payroll tax)
• excise tax