Scenario 20-1 ​

question 109

Multiple Choice

Scenario 20-1
​
The government is proposing switching from a progressive tax system in which families pay 15% of the first $50,000 earned, 25% of the next $50,000 earned, and 35% of any income over $100,000 to a tax system in which every family pays 20% of their income minus $20,000.
-Refer to Scenario 20-1. What would libertarians think of the tax two policies?

• A)They would favor the current progressive policy over the proposed policy because it accounts for diminishing marginal utility.
• B)They would favor the proposed tax policy over the current progressive policy because it would result in a negative tax for the poorest families.
• C)They would favor the current progressive tax policy over the proposed policy because it rewards those who work the hardest.
• D)They would oppose both tax policies because both redistribute income.

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Definitions:

Environmental Impact

The effect human activities have on the environment, including natural resources, wildlife, and ecosystems.

Canada

A country located in the northern part of North America, known for its vast landscapes, multicultural populations, and as the second largest country by total area.

Slash-And-Burn Cultivation

An agricultural method that involves cutting and burning of plants in a forest or woodland to create a field called a swidden.

Tropical Forests

Dense, warm, and wet forests found near the Equator, characterized by high biodiversity and a variety of flora and fauna.