Post Utme Abu 2024 Economics Question 21

Practice objective / multiple choice question 21 from the 2024 Post Utme Abu Economics examination.

Post Utme Abu 2024 Economics Objective / Multiple Choice
Question 21 POST_UTME_ABU • 2024 • ECONOMICS • objective

A government plans to implement a new tax policy to reduce income inequality. The policy involves a progressive tax system where higher-income individuals pay a higher tax rate. However, the policy also includes a tax exemption for low-income individuals. What is the opportunity \cost of implementing this policy?

Answer Options

Correct Answer A. The opportunity \cost is the reduction in economic growth due to the increased tax burden on high-income individuals.
B. The opportunity \cost is the increase in tax revenue from high-income individuals.
C. The opportunity \cost is the reduction in tax revenue from low-income individuals.
D. The opportunity \cost is the increase in economic inequality due to the tax exemption for low-income individuals.
Correct Answer
A
Correct Option:
The opportunity \cost is the reduction in economic growth due to the increased tax burden on high-income individuals.

About This Question

This is Post Utme Abu 2024 Economics Question 21. It is one of the objective questions from the 2024 Post Utme Abu Economics examination.

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