In Which of the Following Situations Is a State Most

question 19

Multiple Choice

In which of the following situations is a state most likely to enforce a usury law?

• A)X purchases two crates of liquor from a minor.
• B)X sells a plot of land at a rate higher than the maximum contract rate.
• C)X sends two boxes of unapproved medicines to children in Africa.
• D)X charges a very high rate of interest on money borrowed by Y.

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Definitions:

Average Tax Rate

The portion of an individual's or entity's taxable income that is paid in taxes, calculated by dividing the total tax amount by the taxable income.

Payroll Tax

A tax imposed on employers and employees, calculated as a percentage of the salaries that employers pay their staff.

Marginal Tax

The additional tax paid on an additional dollar of income, used in progressive tax systems to tax higher incomes at higher rates.

Proportional

A relationship or ratio between two quantities where they change at the same rate.