B5C07 7.3 & 7.4 Plenary

What is one way the government can reduce the tax burden on low-income individuals?

• By increasing tax allowances

• By increasing sales taxes on essential goods.

• By reducing access to public services.

• By introducing flat taxes for all income groups.

Which of the following is a measure to narrow the income gap?

• Increasing indirect taxes on essential goods

• Increasing public spending on services for the lower-income population

• Reducing transfer payments

• Lowering tax allowances for low-income individuals

Transfer payments such as unemployment benefits can be increased to support the low-income group directly.

• True

• False

Indirect taxes can be used to reduce the income gap between high-income and low-income groups by:

• Providing subsidies to low-income groups

• Imposing higher taxes on luxury goods consumed by high-income groups

• Reducing government spending

• Increasing direct taxes on all groups

Fill in the blank: Government spending on public housing, education, and medical services can help improve ______ and reduce inequality.

• equity

• inflation

• exports

• pollution

What is meant by 'resource allocation' in the context of government expenditure?

• Directing resources to sectors that may be underfunded or socially important.

• Reducing overall government spending to balance the budget.

• Increasing taxes to generate more revenue for the government.

• Privatizing public assets to improve efficiency.

What is the effect of a balanced budget on the economy?

• Highly expansionary

• Mildly expansionary

• Contractionary

• Neutral

A deficit budget is considered ________ because it involves injecting more money into the economy.

• more expansionary

• more contractionary

• neutral

• deflationary

When estimated revenue exceeds estimated expenditure, the budget is called a ________.

• Surplus Budget

• Deficit Budget

• Balanced Budget

• Zero-Based Budget

The overall effect on the economy of a balanced increase in government spending and revenue is still expansionary.

• True

• False