1. “Retired seniors should pay higher taxes than college students because government-

funded healthcare for seniors costs more than government-funded tuition.” Is this statement consistent with a principle of tax-system fairness?

2. Florida levies the following taxes: a 5.5 percent corporate income tax; a 6 percent sales tax; taxes of $0.34 a gallon on gasoline, $1.34 a pack on cigarettes, $0.48 a gallon on beer, and $2.25 a gallon on wine; and property taxes that vary across the counties and range from 1.4 percent to 2.0 percent of property values. Classify Florida’s taxes into progressive, proportional, and regressive taxes.

3. What are the main differences between a flat tax and the FairTax? Which of the two taxes places a greater weight on efficiency and a smaller weight on fairness in the big tradeoff?