All categories

3 years ago

Explain the roles of taxation and government expenditure in the circular flow of income

1 answer:

6 0

The role of taxation in the circular flow of income, is basically to have a medium of revenue for the government, if the government is able to earn money, they are able to spend it on the economy.
So then the role of Government expenditure is to make sure the money goes back into the economy, if the government were to save the money, the economy will have restriction to grow, if all the money the government creates from tax was put back into the economy by spending in say, Heath, Education, Investment, the economy can grow because then household will spend money from their income to utilise these industries.
Hopefully this helps!

You might be interested in

Which statement best explains why this passage is an effective use of rhetoric?

erma4kov [3.2K]

Answer:B

Explanation:

6 0

3 years ago

Read 2 more answers

A man buys a racehorse for $20 comma 00020,000 and enters it in two races. He plans to sell the horse afterward, hoping to mak

Step2247 [10]

Answer:

<h2>A man buys a racehorse for $20,000 and enters it in two races. He plans to sell the horse afterward, hoping to make a profit. If the horse wins both races, its value will jump to $100,000. If it wins one of the races, it will be worth <em>$50,000.</em></h2>

Explanation:

7 0

2 years ago

An increase in income, holding prices constant, can be represented as A. a change in the slope of the budget line. B. a parall

Lisa [10]

Answer:

Option (B) is correct.

Explanation:

If there is an increase in the income of the consumer then as a result there is a parallel shift in the budget line. This increase in income will increase the real purchasing power of the consumers and hence, this would increase the quantity of two goods consumed in an equal proportion.

Other factors remains the same, an increase in the income level of the consumer will increase the consumption of both the goods because the prices of both the goods are constant.

5 0

3 years ago

A ___________ is who a creditor may turn the account over to after exhausting its efforts to get a consumer to make past-due pay

dmitriy555 [2]

Answer: collection agency

Explanation:

7 0

2 years ago

Sibila, Inc. sells its product for $40. The variable costs are $18 per unit. Fixed costs are $16,000. The company is considering

Ahat [919]

Answer:

c. It will increase.

Explanation:

Break even point is the level of activity at which a firm neither makes a profit nor a loss.

<em>Break - even units = Fixed Costs ÷ Contribution per unit </em>

therefore,

<u>Existing break-even point in units :</u>

Break - even units = $16,000 ÷ ($40 - $18) = 727.27 or 728 units

<u>New break-even point in units :</u>

Break - even units = $21,000 ÷ ($40 - $16) = 875 units

Conclusion :

The results show that break-even point in units will increase from 728 units to 875 units as a result of the changes

8 0

2 years ago