With a Lump-Sum Tax

question 359

Multiple Choice

With a lump-sum tax,

• A) the average tax rate for high income taxpayers will be the same as the average tax rate for low income taxpayers.
• B) the average tax rate for high income taxpayers will be lower than the average tax rate for low income taxpayers.
• C) the average tax rate for high income taxpayers will be higher than the average tax rate for high income taxpayers.
• D) Any of the above could be true under a regressive tax system.

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Definitions:

SEC

The Securities and Exchange Commission is an agency of the U.S. government tasked with enforcing federal laws pertaining to securities and overseeing the securities industry, including stock and options exchanges.

10-K Report

An annual comprehensive report filed by publicly traded companies in the United States, detailing their financial performance, required by the SEC.

LIFO Layers

An inventory valuation method where the last items placed in inventory are the first ones to be recorded as sold.

Profit Margin

A financial ratio that indicates the percentage of revenue that exceeds the costs of goods sold, showing how much profit is made on sales.