TRUE OR FALSE

1.An item or event that results in a third part receiving a benefit or incurring a cost to a third party is called an externality.

2 A private good is a good that is neither excludable nor rival in consumption.

3 A budget deficit is an excess of government spending over government revenues.

4 The average tax rate is the extra taxes paid on additional dollar of income.

5 A progressive tax is a tax for which high-income taxpayers pay a larger fraction of their income tan o lower-income taxpayers.