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13 Cards in this Set
- Front
- Back
equal tax treatment doctrine
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Taxpayers in the same economic curcumstances should be treated equally.
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horizontal equity
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People in identical economic circumstances pay an equal amount of taxes.
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verical equity
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Taxpayers in different economic circumstances are treated unequally based on either the ability to pay or the benefits recieved.
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relative tax treatment doctrine
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Taxpayers in different economic circumstances should be treated unequally.
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ability-to-pay principle of taxation
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Taxes should be distibuted among taxpayers based on the ability to pay taxes.
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benefits-recieved principle of taxation
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Taxes should be distributed amoung taxpayers based on the individual benefits recieved from government goods and services.
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excess tax burden
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A measure of tax inefficiency: that is, it measures the nonneutral or the distortionary effets of the tax on relative prices and resouce allocation.
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forward tax shifting
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Situation in which any part of a tax is paid for by consumers in the form of higher prices.
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backward tax shifting
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Situation in which any part of the tax is paid for by the owners of resources in the form of lower resource prives.
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tax incidence
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The burden or the final resting place of the tax.
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price esasticity of demand
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The responsiveness of the quantity demanded of a product to changes in the product's price.
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perfect price elasticity of demand
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An increase in price results in a reduction in quantity demanded to zero. This situation is usually shown as a horizontal demand curce at the current price.
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perfect price inelasticity of demand
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An increase in price results in no change in the quantity demanded. This situation is usually shown as a vertical demand curve at the current quantity demanded.
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