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Macroeconomics : private and public choice

James D Gwartney, Richard Stroup, A H Studenmund

Chapter 5

TAXES AND GOVERNM ENT SPENDING - all with Video Answers

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Chapter Questions

02:28

Problem 1

The major categories of government spending are (a) national defense, (b) education, and (c) income transfers and antipoverty expenditures. Why do you think that the public sector has become involved in these activities? Why not leave them to the market?

Jennifer Stoner
Jennifer Stoner
Numerade Educator

Problem 2

Do you think that the tax burden in the United States is too large or too small? Explain. What policies, if any, would you advocate to change the tax burden and its distribution? Be specific and defend your position.

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01:35

Problem 3

The progressive personal income tax is the major source of tax revenue in the United States. What do you think is good about this tax? What is bad about it? What changes, if any, would you make in the nature of this tax? Why?

Anand Jangid
Anand Jangid
Numerade Educator
01:09

Problem 4

"Transfer payments exert no influence on our economy because they merely transfer income from one group of individuals to another." Evaluate.

Anthony Han
Anthony Han
Numerade Educator

Problem 5

Do you think that legislators really attempt to design taxes in a manner that conceals the cost imposed on their constituents? Give evidence to support your view. Do legislators act rationally? Does the political process encourage them to act rationally? Discuss.

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01:06

Problem 6

Do you think it would be a good idea to adjust tax brackets for inflation and thereby prevent the automatic raising of taxes by inflation? Why or why not?

Banhishikha Sinha
Banhishikha Sinha
Numerade Educator
02:42

Problem 7

What's Wrong with This Way of Thinking?
"Antiunion Congressmen argue that the social security payroll tax should continue to be divided equally between the employer and his employees. My bill would levy five-sixths of the tax on the employer, whereas the employee would pay only one-sixth. This approach would take some of the tax burden off the back of the employee and allocate it to the employer, who can better afford to pay it." Senator Friend of the Workingman.

Jesse Leija
Jesse Leija
Numerade Educator