Taxation and Government Spending

What is one of the primary purposes of government spending?

• To increase the wealth of government officials

• To provide public goods and services

• To reduce the national debt

• To increase inflation

Which of the following is a type of direct tax?

• Sales tax

• Income tax

• Value-added tax (VAT)

• Excise duty

Which of the following is an example of an indirect tax?

• Property tax

• Corporate tax

• Sales tax

• Income tax

Why do governments impose taxes?

• To discourage savings

• To fund public services and infrastructure

• To increase the wealth of citizens

• To reduce the population

Which of the following is a method of tax classification?

• By the color of the currency

• By the level of government imposing the tax

• By the number of taxpayers

• By the amount of money in circulation

What is the impact of high taxes on the economy?

• Increased consumer spending

• Reduced investment and savings

• Higher employment rates

• Increased inflation

Which of the following is a direct tax?

• Customs duty

• Income tax

• Service tax

• Sales tax

What is an example of an indirect tax?

• Corporate tax

• Property tax

• Excise duty

• Wealth tax

Which of the following is a reason for government spending?

• To increase the national debt

• To provide social welfare programs

• To reduce the population

• To increase inflation

Which of the following is a type of direct tax?

• Value-added tax (VAT)

• Excise duty

• Corporate tax

• Sales tax