Role of government

Which of the following is an appropriate government policy for increasing employment in an economy?

• introducing measures to reduce the level of spending in an economy

• encouraging the import of goods from overseas

• providing incentives and grants to new businesses

• reducing import taxes, leading to an influx of cheap imports

The notation of social inclusion involves:

• taxing higher incomes at proportionately the same rate as lower incomes

• a welfare system that provides for the needs of all citizens

• government economic decisions being given priority over private decisions

• tax incentives that encourage hard work and enterprise

Which of the following is a reason for levying taxes?

• to raise revenue for the government

• to reduce levels of inequality in society

• to discourage antisocial activities

• to finance reduced levels of government expenditure

Import tax is:

• an indirect tax

• a proportional tax

• levied on purchases of goods

• paid by most wage earners

A direct tax is most likely to be levied on:

• imports of goods

• the purchase of goods

• capital gains

• the sale of goods

The government charges a higher percentage in tax on higher profits than on lower profits. This is an example of a:

• progressive tax

• indirect tax

• proportional tax

• regressive tax

Which of the following government actions is least likely to result in an increased standard of healthcare?

• the building of new modern hospitals

• reducing expenditure per head on the health service

• effective planning of healthcare provision

• transferring money from taxes to healthcare spending

Stamp duty is a tax that is levied on:

• the import of certain"harmful" products

• documents and important legal paperwork

• postage stamps

• the export of goods to another country

Which of the following is a characteristic of a loan but not of a grant?

• interest will be charged on the sum advance

• the recipient will benefit from a cash advance

• the finance will be advanced for a specific purpose

• the recipient is able to spend the sum advanced

The burden of a tax falls on:

• the collector of the tax

• the government that receives tax revenues

• the final payer of the tax

• the tax collection authorities