A Tax Is Regressive If the Average Tax Rate

question 237

Multiple Choice

A tax is regressive if the average tax rate

• A) increases as income increases.
• B) increases as income decreases.
• C) is negative.
• D) is less than one.

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Definitions:

Plaster

A building material used for coating walls and ceilings, made by mixing lime, sand, cement, and water.

Labor

The physical and mental effort used in the production of goods and services.

Positive Supply

A market condition where suppliers are willing to offer goods or services at a particular price level.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded by consumers at those prices.