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Economics · May / June 2017 · Paper 11 · Question 16

2281Fiscal policy

When is a tax progressive?

  1. Awhen some goods have a higher tax than others
  2. Bwhen the rate of tax increases as income increases
  3. Cwhen the tax is linked to the rate of inflation
  4. Dwhen the tax is on incomes rather than on goods or services

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Correct answer: B. when the rate of tax increases as income increases

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