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ECS1601 ASSESSMENT 2 2024 Which one of the following statements regarding government spending and the financing of such spending is incorrect? a. Personal income tax is the only source of revenue that can be used to finance government spending. b. The inc£4.53
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ECS1601 ASSESSMENT 2 2024 Which one of the following statements regarding government spending and the financing of such spending is incorrect? a. Personal income tax is the only source of revenue that can be used to finance government spending. b. The inc
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Module
Economics IB (ECS1601)
Institution
University Of South Africa (Unisa)
ECS1601 ASSESSMENT 2 2024
Which one of the following statements regarding government spending and the financing of such spending is incorrect?
a. Personal income tax is the only source of revenue that can be used to finance government spending.
b. The income received from state-owned enterprises...
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Which one of the following statements on nationalisation and privatisation is
correct?
a. Commercialisation the same as privatisation.
b. Nationalisation is the transfer of ownership from the public sector to the
private sector.
c. Privatisation is the transfer of ownership from private enterprise to
government.
d. One of the arguments in favour of privatisation is that the privatised firm
may attract direct foreign investment.
Clear my choice
Question 2
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If the government intends making use of a contractionary fiscal policy, it should …
a. decrease taxes and decrease government spending.
b. increase taxes and decrease government spending.
c. increase the interest rate.
d. decrease taxes and increase government spending.
Value Added Tax (VAT) is an example of which type of taxes?
a. selective tax, direct tax and progressive tax
b. general tax, indirect tax and progressive tax
c. general tax, indirect tax and regressive tax
d. selective tax, indirect tax and regressive tax
Clear my choice
Question 4
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The following table gives the tax rates for individuals for the 2016 tax year:
2016 tax year (1 March 2015 - 29 February 2016)
Taxable income (R) Rates of tax (R)
0 - 181 900 18% of each R1
181 901 - 284 100 32 742 + 26% of the amount above 181 900
284 101 - 393 200 59 314 + 31% of the amount above 284 100
393 201 - 550 100 93 135 + 36% of the amount above 393 200
550 101 - 701 300 149 619 + 39% of the amount above 550 100
701 301 and above 208 587 + 41% of the amount above 701 300
If the government decides to increase the tax rate for those earning more than R701
300 from R208 587 + 41% of the amount above R701 300 to R208 587 + 43%, it
implies that it has increased the … for high-income groups, which is an example of …
a. capital gains tax; value added tax.
b. minimum tax amount; vertical equity.
c. marginal tax rate; vertical equity.
d. marginal tax rate; horizontal equity.
If the government decides to increase value-added tax (VAT) from 15 to 16%, what
impact would this have on consumers?
a. A higher VAT rate will make households with the lowest incomes worse off.
b. Tax revenue generated from an increase in VAT will also increase spending
on public healthcare.
c. VAT will only affect producers and not consumers.
d. An increase in the VAT rate does not affect consumers’ decisions to save
and invest.
Clear my choice
Question 6
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In the past two years, the issue of nationalisation versus privatisation has become
significant in political debates in South Africa. In this context, what does
nationalisation refer to?
a. the process of the change of ownership from government to the private
sector
b. the transference of ownership of your small Toyota Corolla to your younger
sibling
c. the changing of all street names to indigenous names
d. the process of the change of ownership from private enterprise to
government
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