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1 | |
In Canada, the fifth of Canadians with the lowest incomes receive: |
| | A) | about 1 percent of total pre-tax income. |
| | B) | about 4 percent of total pre-tax income. |
| | C) | about 9 percent of total pre-tax income. |
| | D) | about 16 percent of total pre-tax income. |
| | E) | about 20 percent of total pre-tax income. |
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2 | |
In Canada, the fifth of Canadians with the highest incomes receive: |
| | A) | about 82 percent of total pre-tax income. |
| | B) | about 74 percent of total pre-tax income. |
| | C) | about 68 percent of total pre-tax income. |
| | D) | about 52 percent of total pre-tax income. |
| | E) | about 46 percent of total pre-tax income. |
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3 | |
Which of the following is not a major reason for the unequal distribution of incomes in Canada? |
| | A) | differences in labour productivity |
| | B) | regional disparities |
| | C) | the willingness of some people to take risks |
| | D) | differences in the ownership of wealth |
| | E) | differences in consumption preferences |
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4 | |
When interpreting the Lorenz curve: |
| | A) | a curve that is a single straight line shows that incomes are highly unequally distributed. |
| | B) | a curve made up of two lines following the horizontal and vertical axes shows that incomes are perfectly equal. |
| | C) | a negatively sloped curve means that incomes are highly unequally distributed. |
| | D) | a curve that is a single straight line shows that incomes are perfectly equal. |
| | E) | none of the above |
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5 | |
Wealth in Canada: |
| | A) | is distributed fairly equally among all Canadians. |
| | B) | is distributed more unequally than income in Canada. |
| | C) | is distributed in the same way as income is in Canada. |
| | D) | is distributed more unequally than wealth in the US. |
| | E) | is distributed more equally than wealth in Sweden. |
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6 | |
A household in Canada is considered to be poor, using the LICO measure, if: |
| | A) | it spends 64 percent or less of its after-tax income on food, clothing and shelter. |
| | B) | the head of the household does not believe the household can survive on its after-tax income. |
| | C) | the household's after-tax income does not provide the minimum living standard as outlined by the United Nations. |
| | D) | the household makes less than 50 percent of the average Canadian household's pre-tax income. |
| | E) | it spends 64 percent or more of its after-tax income on food, clothing and shelter. |
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7 | |
The LICO poverty line in Canada: |
| | A) | is the income below which it is likely that someone will not be able to survive. |
| | B) | is the minimum income that businesses can pay workers. |
| | C) | differs depending on whether one lives in a rich or poor community. |
| | D) | differs depending on whether one lives in a rural or urban area. |
| | E) | differs depending on which province one lives in. |
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8 | |
The incidence of poverty in Canada is highest for which of the following groups? |
| | A) | single-parent families with a female head |
| | B) | unattached females |
| | C) | single parent families with a male head |
| | D) | unattached males |
| | E) | married couples |
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9 | |
A taxpayer who earns $20,000 pays $5000 in tax, while another taxpayers who earns $30,000 pays $10,000. This tax is: |
| | A) | regressive, because the higher income taxpayer pays a higher amount of tax. |
| | B) | proportional, since the both taxpayers pay the same percentage of their incomes in tax. |
| | C) | progressive, since the higher income taxpayer pays a greater percentage of her income in tax. |
| | D) | regressive, since the higher income taxpayer pays a lower percentage of her income in tax. |
| | E) | progressive, since the higher income taxpayer pays a lower percentage of her income in tax. |
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10 | |
The use of LICO as a poverty measure is sometimes criticized because: |
| | A) | it is an absolute measure of poverty. |
| | B) | it is a relative measure of poverty. |
| | C) | it shows that Canada's poverty rate is very low. |
| | D) | it is too closely tied to poverty measures in other countries. |
| | E) | none of the above |
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11 | |
The tax philosophy most closely tied to the goal of income equity is: |
| | A) | the cashflow principle |
| | B) | the government needs principle |
| | C) | the benefits received principle |
| | D) | the ability to pay principle |
| | E) | the balanced income principle |
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12 | |
The tax philosophy most closely geared to the notion that taxpayers should pay in relation to the government services they receive is: |
| | A) | the cashflow principle |
| | B) | the government needs principle |
| | C) | the benefits received principle |
| | D) | the ability to pay principle |
| | E) | the balanced income principle |
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13 | |
A regressive tax is one where: |
| | A) | people with high incomes pay a larger proportion of their income in tax than do those with low incomes. |
| | B) | people with high incomes pay a smaller proportion of their income in tax than do those with low incomes. |
| | C) | people with high incomes pay a larger dollar amount in tax than do those with low incomes. |
| | D) | people with high incomes pay a smaller dollar amount in tax than do those with low incomes. |
| | E) | people with high and low incomes pay the same proportion of their income in tax. |
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14 | |
Canada's personal income tax system: |
| | A) | is roughly proportional, with all income earners paying approximately the same proportion of the income in tax. |
| | B) | is regressive, even though higher marginal tax rates are paid as income increases. |
| | C) | is regressive, largely due to the lower marginal tax rates paid as income increases. |
| | D) | is progressive, even though lower marginal tax rates are paid as income increases. |
| | E) | is progressive, largely due to the higher marginal tax rates paid as income increases. |
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15 | |
Thomas Malthus believed that: |
| | A) | aid to the needy is self-defeating, since it encourages population growth. |
| | B) | food grows in a geometric progression. |
| | C) | over time, food production necessarily outstrips population growth. |
| | D) | population grows in an algebraic progression. |
| | E) | none of the above |
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2002 McGraw-Hill Higher Education