Which of the following is an example of a tax you must pay?

• A. A tip given to a restaurant server
• B. A lottery prize received
• C. Sales tax on purchased goods
• D. Interest earned from a savings account

Answer: (C)

Verified step by step guidance

1. Understand the definition of a tax: A tax is a compulsory financial charge or some other type of levy imposed by a government on individuals or entities to fund government spending and public services.
2. Analyze each option to determine if it fits the definition of a tax:
3. - A tip given to a restaurant server is a voluntary payment made directly to the server and is not imposed by the government.
4. - A lottery prize received is income or a gain, not a payment made to the government; however, taxes may be applied to the prize afterward, but the prize itself is not a tax.
5. - Sales tax on purchased goods is a mandatory charge imposed by the government on the sale of goods and services, making it a clear example of a tax you must pay.