Certified Government Financial Manager (CGFM) Practice Exam 2025 – Your All-in-One Guide to Exam Success!

Question: 1 / 875

How is a mill defined in the context of property tax?

1/100th of a cent

1/10th of a cent of 1/1000 of a dollar

In the context of property tax, a mill is defined as 1/1000th of a dollar. This means that when property taxes are calculated, a mill rate indicates the amount of tax payable per $1,000 of assessed property value.

The mill rate is commonly used by local governments to determine property taxes. For example, if the mill rate is set at a certain number of mills, this number indicates how many dollars will be paid in tax for every $1,000 of assessed property value. This makes it easier to calculate property taxes and allows for a straightforward understanding of how much tax is owed based on the assessed value.

While the other options present variations of monetary definitions, they do not accurately capture the conventional definition of a mill within the context of property tax. The correct understanding is crucial for accurately interpreting property tax rates and performing calculations associated with them.

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1/1000th of a dollar

One cent

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