A Tax System in Which Taxpayers Pay a Progressively Larger

question 42

Multiple Choice

A tax system in which taxpayers pay a progressively larger share of their income in taxes as their income rises is called:

• A) a flat tax system.
• B) a progressive tax system.
• C) a digressive tax system.
• D) a political tax system.

---

Definitions:

Total Surplus

The total net gains for society represented by the combined amount of consumer surplus and producer surplus in a market.

Producer Surplus

This is an economic measure of the difference between the amount producers are willing to supply a good for and the amount they actually receive.

Consumer Surplus

The difference between the maximum price consumers are willing to pay for a product and the actual market price they pay.

Producer Surplus

The difference between the amount producers are willing to accept for a good or service and the actual amount they receive due to market price.