Which One of the Following Is the Ratio of Actual

question 65

Multiple Choice

Which one of the following is the ratio of actual output from factories to potential output from factories?

• A) Capacity utilization
• B) Participation rate
• C) Durable goods orders
• D) Industrial production

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Definitions:

Income Tax

A tax levied by a government directly on income, especially an annual tax on personal income.

Horizontal Equity

The principle that individuals in similar financial conditions should be treated equally by the taxation system.

Vertical Equity

A principle in taxation that states taxpayers with a greater ability to pay should contribute more in taxes.

Regressive Tax

A tax for which high-income taxpayers pay a smaller fraction of their income than do low-income taxpayers.