Answer to Question #167835 in Economics for Fabien

Question

Suggest 2 possible reasons why a government might increase the indirect tax on such goods(any chosen good)and discuss, in light of these reasons the likely effectiveness of such a policy(12)

• Definition
• Causes of an imposition of an I.T
• Cost of production-> fall in ss leftward shift
• Diagrams-> consumer’s burden/ producers
• Government revenue
• PED

Answer 1

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