Horizontal Equity Refers to a Tax System in Which Individuals

question 130

True/False

Horizontal equity refers to a tax system in which individuals with higher incomes pay more in taxes than individuals with lower incomes.

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Definitions:

Economic Profit

The variance between gross receipts and all outlays, including both tangible and intangible costs.

Accounting Profit

The total revenue of a business minus the explicit costs of operating, not including opportunity costs.

Implicit Costs

The opportunity costs that are not directly paid out but represent the loss of potential income from using resources in a certain way.

Opportunity Costs

Missing out on possible advantages from other choices by opting for a particular alternative.