A Consumption Tax Would

question 42

Multiple Choice

A consumption tax would

• A)encourage saving because individuals would only pay taxes on income they spend.
• B)be progressive because everyone would be subject to the same tax system.
• C)be progressive because higher income people spend more than lower income people.
• D)be proportional because everyone would be subject to the same tax system.

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Definitions:

Balance Sheet

A financial statement that shows a company's assets, liabilities, and shareholders' equity at a specific point in time.

Income Statement

a financial statement that shows a company's revenues and expenses, and thus its profit or loss, over a specific period of time.

Percentage of Net Change

A calculation that measures the difference in a financial figure over a period as a percent of its value at the start of the period.

Comparative Income Statement

A financial statement that compares income, expenses, and net profits over different periods to show performance trends.