Asked by
Sundharesh Sivashanmugam
on Oct 13, 2024Verified
Groucho earns $5 million and pays $2 million in taxes;Harpo earns $300,000 and pays $80,000 in taxes;Chico earns $25,000 and pays $1,000 in taxes.The tax they pay would be considered
A) progressive.
B) proportional.
C) regressive.
Proportional
Proportional describes a relationship or ratio that maintains the same relative size or aspect between items or variables.
Regressive
Refers to a tax system in which the tax rate decreases as the taxable amount increases, often placing a heavier burden on low-income earners.
Progressive
A political and social philosophy advocating for reforms that aim to reduce inequality, improve social justice, and enhance welfare.
- Become familiar with the types of fiscal policies (regressive, progressive) and their effects on various income categories.
Verified Answer
AL
Learning Objectives
- Become familiar with the types of fiscal policies (regressive, progressive) and their effects on various income categories.