A Static Forecast of the Incremental Revenue from a Tax

question 78

Multiple Choice

A static forecast of the incremental revenue from a tax rate increase presumes that:

• A) The tax base will not change because of the rate increase.
• B) The tax base will increase by the same proportion as the rate increase.
• C) The tax base will decrease by the same proportion as the rate increase.
• D) The tax rate and the tax base are correlated.

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Definitions:

Charitable

relating to or involving the giving of money, goods, or help to those in need without expecting anything in return.

Subsidized

Financial support provided, often by the government, to help reduce the cost of a service or commodity to the end user.

Economic Development

Activities aimed at improving the economic well-being and quality of life for a community, by creating and retaining jobs and supporting or growing incomes.

Operational

Pertains to the normal, day-to-day activities required for an organization or project to function effectively and efficiently.