Another Name for a "Flat-Rate Tax" in Which the Same

question 23

Multiple Choice

Another name for a "flat-rate tax" in which the same tax rate applies to all income earners is a

• A) proportional tax.
• B) progressive tax.
• C) regressive tax.
• D) passive tax.

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Definitions:

Zero Coupon Bond

A bond issued at a discount and repaid at face value at maturity without periodic interest payments.

Percentage Increase

A measure of the degree to which a quantity grows over a period of time, calculated as the change in value divided by the original value and expressed as a percentage.

Interest Rate Price Risk

The potential for an investment’s value to change due to a fluctuation in the absolute level of interest rates, illustrating the inverse relationship between price and interest rates.

Zero Coupon Bond

A bond that does not pay periodic interest payments but instead is issued at a discount to its redemption value.