Most non-farm jobs in Texas are in the general area of a. manufacturing.

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1 Government decisions regarding revenues, expenditures, and borrowing are referred to as a. monetary policy. b. foreign policy. c. banking policy. *d. fiscal policy. Texas has generally resisted using all of the following to balance the budget, except a. enacting a state income tax. b. increasing various state taxes. *c. reducing agency funding. d. borrowing from the rainy day fund. The traditional Texas fiscal policy is the achievement of a balanced budget through *a. low taxes and low levels of public spending. b. high taxes and low public spending. c. high taxes and high public spending. d. low taxes and high public spending. Taxes that are a greater burden on lower incomes and less so on higher incomes are known as a. flat taxes. b. progressive taxes. *c. regressive taxes. d. nominal taxes. Taxes that rely more heavily on revenues from higher incomes are known as a. flat taxes. *b. progressive taxes. c. regressive taxes. d. nominal taxes. Which of the following is not a source of revenue for Texas state government? *a. State income tax b. General sales tax c. Franchise tax d. Severance tax Which group of Texans pays the most in taxes proportional to their income? a. Middle class b. Wealthiest 20 percent c. Purchasers of luxury cars *d. Poorest 20 percent Most non-farm jobs in Texas are in the general area of a. manufacturing.

2 *b. service providing. c. food processing. d. local government. The Texas state tax mandated on the revenue of many businesses is the a. state income tax. b. general sales tax. *c. franchise tax. d. severance tax. The pay-as-you-go system means that the Texas legislature must a. pay its bills on time. b. pass a surplus budget. c. borrow to pay its bills. *d. not pass a deficit budget. The fund available to the Texas legislature for general appropriations purposes is called the a. rainy day fund. b. general obligation fund. *c. general revenue fund. d. sales tax revenue fund. Regarding fiscal policy, the Texas Constitution requires that the a. legislature draft and pass an annual budget. b. state s expenditures should be within 10 percent of projected state revenues. *c. state s spending should be in balance with projected state revenues. d. governor certify that state spending is in balance with state revenues. The tax that produces the most significant amount of revenue in Texas is the *a. general sales tax. b. selective sales tax. c. business franchise tax. d. gross receipts tax. The online retailer Amazon must collect sales taxes on items consumers purchase because *a. it has facilities in the state of Texas. b. it uses the Internet for consumer purchases. c. Texas is a member of the Streamlined Sales and Use Tax Governing Board. d. the Texas Supreme Court has ordered it to do so. So-called sin taxes are levies placed on *a. alcohol, mixed drinks, and tobacco. b. food, clothing, and drinks. c. hotel and restaurant revenues.

3 d. hunting and fishing activities. The unemployment compensation system is supported by a. a special sales tax. b. an excise tax. *c. a payroll tax. d. a severance tax. Most taxes in Texas are administered by the a. commissioner of insurance. *b. comptroller of public accounts. c. secretary of the Treasury. d. county tax assessor-collector. Where does Texas rank among the states in the tax burden on its citizens? a. Near the top b. About twentieth c. About thirty-fifth *d. Near the bottom If someone fails to claim their prize from the Texas Lottery within 180 days after a drawing the money is used to fund a. welfare programs. b. public education. c. gambling addiction treatment programs. *d. hospitals for indigent care. Grants-in-aid are defined as *a. money from the federal government to the state. b. state matching of federal funds. c. money from private foundations to the state. d. federal money to states based on income tax ratios. Which state program in Texas does not receive substantial federal funding? a. Public education b. Highways *c. Teacher retirement d. Public assistance The largest share of public land revenue in Texas is derived from a. the sale of land to private individuals. b. the sale of timber. *c. oil lease fees and royalties. d. recreational use fees. The investment of state funds is currently handled by the

4 *a. comptroller of public accounts. b. State Auditor s Office. c. state treasurer. d. Legislative Budget Board. In order for Texas to increase its bond debt, approval must be given by the a. Texas legislature. b. Texas governor. *c. voters of Texas. d. comptroller of public accounts. A bond whose repayment is guaranteed by the full faith and credit of the state is a a. revenue bond. *b. general obligation bond. c. special assessment bond. d. limited obligation bond. Another name for the state s Economic Stabilization Fund is the a. general obligation fund. b. pork barrel fund. *c. rainy day fund. d. general revenue fund. The fiscal biennium in Texas begins on a. July 1 of odd-numbered years. b. January 1 of even-numbered years. *c. September 1 of odd-numbered years. d. October 1 of even-numbered years. Unlike the federal budget, a budget passed by the Texas legislature a. must pass both the house and Senate. b. requires a four-fifths vote to override a veto. *c. authorizes spending for a two-year period. d. must go to the chief executive for approval. In Texas, projected revenue levels are provided to the governor and legislature by the a. State Auditor s Office. *b. state comptroller of public accounts. c. General Accounting Office. d. Governor s Office of Budget and Planning. After the legislature approves a biennial budget, the governor cannot sign it until a. the attorney general issues an opinion that all expenditures are permitted by the Texas Constitution. b. the lieutenant governor and the Speaker of the House vote to approve it.

5 c. the Legislative Budget Board certifies that proper procedures were followed in approving the budget. *d. the comptroller certifies the state will collect sufficient revenue to cover the expenditures. The second largest single expenditure item by functional class of the Texas government is a. debt service. *b. public elementary and secondary education. c. public higher education. d. public assistance. Which of the following determines if state agencies have spent public funds in accordance with law? a. The comptroller of public accounts *b. The State Auditor s Office c. The Legislative Budget Board d. The secretary of state The Robin Hood Plan is an attempt to equalize funding among a. charter schools. *b. public schools. c. private universities. d. public universities. Which factor will increase the state s outcomes-based funding to a community college? a. An increase in enrollment b. A decrease in tuition rates c. An increase in the number of low-income students enrolled *d. An increase in the number of students successfully completing courses Compared to the rest of the nation, the number of children without health insurance coverage in Texas is a. among the lowest. b. about average. *c. the highest. d. decreasing rapidly. The program acronym CHIP stands for a. Christian Hospital Insurance Plan. *b. Children s Health Insurance Program. c. Cooperative Hospital Inclusive Project. d. Children s Home Improvement Protection.

6 According to the Texas Transportation Commission, the newest means of financing Texas highways is the use of a. money from the sale of bonds. *b. money collected from tolls. c. increased gas taxes. d. a state income tax.