WorksheetsY10 Economics - C26 Fiscal Policy
Total questions: 13
Worksheet time: 7mins
What does a balanced budget mean?
The government spends more than it collects
The government collects more than it spends
The government manages to balance its revenues and spending
The government has no budget at all
Which of the following is a reason for government spending?
To promote private businesses
To reduce government revenue
To provide essential services
To increase taxes
What is a tax?
A government levy on income or expenditure
A form of investment
A type of government spending
A government subsidy
Which type of tax is paid from the income of individuals?
Indirect tax
Sales tax
Direct tax
Value added tax
What is progressive taxation?
A tax system that does not exist
A tax system where higher earners pay a higher rate
A tax system where everyone pays the same rate
A tax system that charges lower rates for the wealthy
What does the principle of equity in taxation refer to?
Taxes should be convenient to pay
Taxes should be easy to collect
Taxes should be based on the taxpayer's ability to pay
Taxes should be flexible
How does taxation impact economic growth?
It can boost domestic spending through tax cuts
It always decreases economic growth
It only affects inflation
It has no effect on economic growth
What is fiscal policy?
The use of interest rates to control inflation
The use of taxes and government spending to affect macroeconomic aims
The regulation of financial markets
The management of public debt
What is expansionary fiscal policy used for?
To control inflation
To stimulate the economy
To reduce government spending
To increase taxes
Which of the following is a potential effect of high taxation?
Encouragement of tax evasion
Increased government revenue
More business investments
Higher consumer spending
What is the purpose of a budget surplus?
To collect more than spent
To eliminate taxes
To balance revenues and spending
To spend more than collected
Which of the following is an example of indirect taxation?
Inheritance tax
Corporate tax
Income tax
Value added tax (VAT)
What is the impact of taxation on wealth distribution?
It has no impact
It can help redistribute income and wealth
It only benefits the wealthy
It increases government spending
