economic Multiple choice
1.The US tax system is overall a fairly _______ tax system. Some elements of the tax system such as the payroll tax are _______.
progressive; regressive
progressive; flat
regressive; flat
flat; regressive
2.One of the main provision of the Affordable Care Act was to
a- Eliminate private health insurance
a- Eliminate public health insurance
a- Mandate and subsidize the purchase of private health insurance
a- Authorize insurers to deny insurance to patients with pre-existing conditions
C
3.If the tax increases by 20 cents, the marginal deadweight loss is _________.
proportional to 20 cents
more than a proportion of 20 cents
less than a proportion of 20 cents
40 cents exactly
4.The most costly tax expenditure for the government is:
The payroll tax
the deduction for health insurance from taxable income
the marriage tax
the mortgage interest deduction from taxable income
5.According to the Congressional budget office tax incidence analysis, since 1979, total effective tax rates for the top quintile have ______ and their share of tax liability has ______, reflecting the _______in their share of income.
decreased; decreased; decrease
decreased; decreased; increase
decreased; increased; increase
increased; increased; increase
6.What is(are) economic reason(s) why individuals should have health insurance?
a- Paternalism
a- Financial and physical externalities
a- Egalitarianism
a- Human rights
7.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. Suppose the government is taxing the production of zucchinis. The amount of the tax is $1.20 per pound. The supply for zucchinis is neither elastic nor inelastic and the demand for zucchinis is neither elastic nor inelastic. Suppose that the new equilibrium price E2 is $4.00. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound, 100 pounds of zucchinis at $4.00 a pound.
Following the tax, the deadweight loss reflects that:
too many zucchinis are exchanged at a SMC>SMB
too many zucchinis are exchanged at a SMC<SMB
too few zucchinis are exchanged at a SMC>SMB
too few zucchinis are exchanged at a SMC<SMB
8.Which of the following has been found to be the primary cause of the rapid rise in health care costs?
moral hazard
corruption and mismanagement
population aging
technological progress in medical services
9.Suppose there is a tax on movie tickets. As a result, individuals go to the restaurant more and eat less popcorn at the movie theater. The effect on restaurants is ________ and the effect on popcorn is _______ .
a complementary effect; an income effect
a substitution effect; an income effect
a substitution effect; a complementary effect
an income effect; a complementary effect
10. The flat of the curve medicine describes that a lot of medical services in the US
a- Provide larger health benefits than they cost the system
a- Save the same number of lives at any cost
a- Have a flat cost for an increasing number of lives saved
a- Provide smaller health benefits than they cost the syste
11.What is true about the French public health insurance system?
a- It does not provide full coverage
a- It provides full coverage
a- It has become more generous to patients over time
a- It does not face deficits
12.Suppose that a tax is imposed on the producers of kitchen tables. Assume that demand for kitchen tables is perfectly elastic. The tables are produced in a factory using capital equipment (lathes, etc.) and labor. Assume that in the long run, the demand for labor is perfectly elastic and the demand for capital equipment is perfectly inelastic. In the long run, partial equilibrium tax incidence analysis suggests that _________ bear the tax; general equilibrium tax incidence analysis suggests that in the long run _________ bear the tax.
consumers; table factories
table factories; table factories
table factories; workers
workers; workers
13.In the US, the share of the population insured through private health insurance is about:
a- 0%
a- A third
a- Two third
a- 100%
14.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound. Suppose now that consumer’s demand is perfectly elastic and the government subsidizes the production of zucchinis for $1.20 per pound and the quantities exchanged are $400.
The deadweight loss is
$0
$60
$120
infinite
15.
Because of diminishing marginal utilities, as inequality increases, the tax system should
become flatter
become more progressive
become more regressive
not be changed
16.The Trump administration has
a- Expanded the provision of private health insurance
a- Expanded the provision of public health insurance
a- Increased the number of individuals covered by insurance overall
a- Eliminated the individual mandate of the Affordable Care Act
17.According to the two rules of income taxation, taxing high income earners at high rates would be___________ rule and ______________;
inconsistent with the vertical equity rule; lead to a small behavioral response;
consistent with the vertical equity rule; lead to a large behavioral response;
consistent with the vertical equity rule; lead to a small behavioral response;
inconsistent with the vertical equity rule; lead to a large behavioral response;
18.Which of these is true concerning Medicare?
Medicare uses a retrospective payment system.
Medicare does not cover all elderly citizens.
Medicare has no premiums on physician visits and prescription drugs.
Medicare never covers the same benefits as those provided by private-sector insurance plans
19.The number one cause of inefficiency in US Health care is
Unnecessary services
Excess administrative costs
Fraud
High prices
20.The statutory burden of a tax describes
the change in resources that individuals experience when they pay taxes
the amount of money that individuals send to the IRS
the economic burden
the response of markets to taxation
21.Regarding health insurance, (a) problem(s) related to the uninsured is (are):
uncompensated care
health externalities
job lock
all of the above
22.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. Suppose the government is taxing the production of zucchinis. The amount of the tax is $1.20 per pound. The supply for zucchinis is neither elastic nor inelastic and the demand for zucchinis is neither elastic nor inelastic. Suppose that the new equilibrium price E2 is $4.00. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound, 100 pounds of zucchinis at $4.00 a pound.
The deadweight loss is
- $100
$100
$60
$120
23.The broad base rule states that:
It is better to tax one good at a high rate than many goods at a low rate
It is equivalent to tax one good at a high rate or many goods at a low rate
It is better to raise a one-time tax to fund government spending rather than go into debt
It is better to tax many goods at a low rate than one good at a high rate
24.Based on CBO projections, the US
was on a sustainable fiscal path prior to the Covid-19 pandemic
was not on a sustainable fiscal path due to irresponsible policymakers who do not reduce deficits during economic expansions.
was on a sustainable fiscal path thanks to short-term borrowing following economic stimulus
was on an unsustainable fiscal path solely due to the Covid-19 pandemic
25.tudy the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. Suppose the government is taxing the production of zucchinis. The amount of the tax is $1.20 per pound. The supply for zucchinis is neither elastic nor inelastic and the demand for zucchinis is neither elastic nor inelastic. Suppose that the new equilibrium price E2 is $4.00. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound, 100 pounds of zucchinis at $4.00 a pound.
The tax burden faced by consumers is:
$0.20
$0.80
$1.00
$1.20
26.According to the two rules of optimal commodity taxation, taxing the consumption of insulin at a high rate would be___________ rule and ______________;
inconsistent with the elasticity rule; inconsistent with the broad base rule;
inconsistent with the elasticity rule; consistent with the broad base rule;
consistent with the elasticity rule; consistent with the broad base rule;
consistent with the elasticity rule; inconsistent with the broad base rule;
27In the US, the share of the population that is uninsured is about:
a- 0%
a- 8%
a- A third
a- Two third
28.In the US, the share of tax revenue coming from consumption taxes is ______ in other OECD countries
smaller than
larger than
roughly the same as
not used contrary to what is don
29.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. Suppose the government is taxing the production of zucchinis. The amount of the tax is $1.20 per pound. The supply for zucchinis is neither elastic nor inelastic and the demand for zucchinis is neither elastic nor inelastic. Suppose that the new equilibrium price E2 is $4.00. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound, 100 pounds of zucchinis at $4.00 a pound.
The tax burden faced by producers is:
$0.20
$0.80
$1.00
30.Medicaid has _______; Medicare has_ _____.
improved elderly’s health; improved children health
improved health overall; improved elderly’s health
improved health overall; not improved elderly’s health
not improved health overall; not improved elderly’s healt
31.Medicaid provides:
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higher reimbursements to physicians than does the private sector
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lower reimbursements to physicians than does the private sector
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similar reimbursements to physicians than does the private sector
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small reimbursement to patients for major services such as physician or hospital care |
32.According to the Congressional budget office tax incidence analysis, since 1979, the share of taxes paid by the bottom quintile of taxpayers has __________.
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decreased |
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increased |
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stayed constant
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remained unknown |
33.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound. Suppose now that consumer’s demand is perfectly elastic and the government subsidizes the production of zucchinis for $1.20 per pound and the quantities exchanged are $400.
The burden faced by producers is:
$0
-$0.20
$1.20
-$1.20
34.For which of the following events is the consumption-smoothing benefit from first-dollar coverage small?
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low-cost predictable events
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costly events that occur only very infrequently
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events such as serious injuries from car accidents
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none of the above |
35.The second rule of taxation states that, when assessing the tax burden
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it matters whether a tax is raised on producers or consumers |
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it does not matters whether a tax is raised on producers or consumers |
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taxes should be raised on the side of the market that is relevant
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taxes should be raised on the side of the market that is irrelevant |
36.An optimal public health insurance system should
a- Provide partial coverage
a- Provide full coverage
a- Provide no coverage
a- Should never ask patients for sharing medical costs
37.Suppose a market has a preexisting positive production externality. A tax on producers would ______________the deadweight loss.
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increase;
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eliminate;
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has generally no effect
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never have an effect |
38.Economists broadly agree that a reform of the US tax system should include
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expanding the tax base by eliminating some exemptions and deductions
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raising bottom marginal tax rates
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cutting taxes to reduce the deficit
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decreasing the payroll tax |
39.A tax on soda would yield _______response by consumers than (as) a broad base tax on all sugar-sweetened beverages
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a more elastic |
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a more inelastic |
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the same |
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The scope of the tax is irrelevant to the burden
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40.Piketty and Saez (2011) find that countries should raise the top marginal tax rates to about to 80 percent because they
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only account for the effect of taxes on work effort and business creation.
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only care about vertical equity.
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don’t find large efficiency gains from lower top marginal tax rates.
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find large efficiency gains from lower top marginal tax rates.
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41.What is an accurate statement?
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The rise in the income share of the top 1% in the USA since the 1960’s is undisputed.
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Economists disagree on whether the share of income of the top 1% in the USA has increased or not since the 1960’s.
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The measurement of income inequality is irrelevant to implement a tax reform.
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Piketty and Saez results on inequality and top marginal tax rates are undisputed.
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42.Study the Zucchini market. Suppose the equilibrium price E1 is initially $3.00 a pound. Suppose the government is taxing the production of zucchinis. The amount of the tax is $1.20 per pound. The supply for zucchinis is neither elastic nor inelastic and the demand for zucchinis is neither elastic nor inelastic. Suppose that the new equilibrium price E2 is $4.00. The quantities exchanged are 200 pounds of zucchinis at $3.00 a pound, 100 pounds of zucchinis at $4.00 a pound.
The tax wedge is:
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$0.20
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$0.80
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$1.00
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$1.20 |
43.What is true about the French Health insurance system?
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It has larger administrative costs than the US private health insurance system
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Infant mortality is larger in France than in the US
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It co-exists with supplemental private health insurance plans
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It does not cover the entire population |
44.Suppose there is large income inequality. In order to maximize social welfare, which statement is accurate?
High income should be taxed up to 100% without limitation
A flat tax would be optimal
High top marginal tax rates are always more efficient
High top marginal tax rates yield equity gains
45.In Canada, the health care system
provides universal coverage and patients generally have to wait less than in the US to see a doctor
does not provide universal coverage and patients generally have to wait longer than in the US to see a doctor
does not provide universal coverage and patients have to wait longer than in the US to see a doctor
provides universal coverage but patients generally have to wait longer than in the US to see a doctor
46.Retrospective reimbursement may result in _______ medical care; prospective reimbursement may result in _______ medical care.
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insufficient; insufficient
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excessive; excessive
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excessive; insufficient
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insufficient; excessive
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47.Taxing similar individuals identically regardless of the type of activity they pursue is consistent with:
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the elasticity rule
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the broad base rule
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vertical equity
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horizontal equity |