Horizontal Equity I.means That Those Taxpayers Who Have the Greatest Ability to Ability

question 79

Multiple Choice

Horizontal equity
I.means that those taxpayers who have the greatest ability to pay the tax should pay the greatest proportion of the tax.
II.means that two similarly situated taxpayers are taxed the same.
III.is reflected in the progressive nature of the federal income tax system.
IV.exists when Avis, a single individual with 4 dependent children, and Art, a single individual with no dependents, both pay $2,400 income tax on equal $26,000 annual salaries.

• A)Statements III and IV are correct.
• B)Statements II and III are correct.
• C)Statements I and III are correct.
• D)Only statement IV is correct.
• E)Statements I, II, III, and IV are correct.

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Definitions:

Temperate Grassland

A grassland characterized by hot summers, cold winters, and less rainfall than is found in a temperate deciduous forest biome.

Mediterranean Sea

A sea connected to the Atlantic Ocean surrounded by the Mediterranean region and almost completely enclosed by land.

Chaparral

A biome with a Mediterranean climate (mild, moist winters and hot, dry summers). Chaparral vegetation is characterized by drought-resistant, small-leaved evergreen shrubs and small trees.

Boreal Forest

A biome characterized by coniferous forests located in northern regions, experiencing cold climates and playing a vital role in the Earth's carbon cycle.