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Cambridge IGCSE Economics practice

Paper 2 structured question: Fiscal policy

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Fiscal policy

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Paper 2Structured Questions1 marks

The government has increased taxes on luxury goods to generate more revenue.

Description

Impact of Luxury Goods Taxation

The new tax is expected to raise prices for consumers and reduce demand for luxury items.

  1. a

    State one effect of this tax on consumers.

    Aim for approximately 1 distinct marking point.

    [1]

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Paper 2 structured question: Fiscal policy

Paper 2Structured Questions4 marks

Description

Effects of Business Taxation

Businesses are cutting back on expansion plans due to increased tax burdens.

  1. a

    Explain how higher business taxes can affect overall economic growth.

    Aim for approximately 4 distinct marking points.

    [4]