Economics (McConnell), AP* Edition, 20th Edition

LO 18.1

Use a circular flow diagram to illustrate how the allocation of resources is affected by government's revenue and expenditure decisions.

LO 18.2

Identify the main categories of government spending and the main sources of government revenue.

LO 18.3

List the main categories of federal revenue and spending and describe the difference between marginal and average tax rates.

LO 18.4

List the main categories of state and local revenue and spending.

LO 18.5

Discuss the magnitude and distribution across job categories of government employment at the local, state, and federal levels.

LO 18.6

Summarize the different philosophies regarding the distribution of a nation's tax burden.

LO 18.7

Explain the principles relating to tax shifting, tax incidence, and the efficiency losses caused by taxes.

LO 18.8

Discuss the probable incidence of U.S. taxes and how the distribution of income between rich and poor is affected by government taxes, transfers, and spending.