Which of the Following Statements Is False

question 63

Multiple Choice

Which of the following statements is false ?

• A) The largest source of state and local governments tax revenue is sales and excise taxes.
• B) The largest source of federal government tax revenue is individual income taxes.
• C) A sales tax on food is a regressive tax.
• D) A proportional tax is equal to a fixed dollar amount.

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Definitions:

Yield to Call

The return an investor would receive if a callable bond is held until the issuer exercises their option to redeem it before its maturity date.

Current Yield

The annual interest payment of a bond divided by its current market price, used to compare the return on investment of different bonds.

Coupon Bond

A debt security that pays the holder a fixed interest rate (the coupon) periodically until maturity, at which point the principal is repaid.

Basis Point

A unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument, equal to 1/100th of 1%.