9/18/24, 10:10 PM Assessment 2: Attempt review
ECS1601-24-Y_AS2 Introduction Assessment 2
QUIZ
Started on Thursday, 25 July 2024, 8:21 PM
State Finished
Completed on Thursday, 25 July 2024, 8:46 PM
Time taken 24 mins 29 secs
Grade 13.00 out of 18.00 (72.22%)
Question 1
Complete
Mark 1.00 out of 1.00
Which of the following elements are regarded as government intervention?
a. Taxation and borrowing only.
b. Spending, interest rate and borrowing.
c. Spending and taxation only.
d. Spending, borrowing and taxation.
The elements of government intervention are spending, taxation, and
borrowing.
The correct answer is: Spending, borrowing and taxation.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=20342755&cmid=1019616 1/13
, 9/18/24, 10:10 PM Assessment 2: Attempt review
Question 2
Complete
Mark 1.00 out of 1.00
Neutrality of taxes means that
a. the recipients generated by a particular government expenditure should
pay for the goods and services concerned.
b. compliance and administration costs are kept as low as possible.
c. taxes have the minimum possible effect on relative prices.
d. the tax burden is spread equally amongst taxpayers.
Taxes affect prices and therefore also the decisions of the various participants
of the economy. As a result, they can distort the allocation of resources and
lower the welfare of society. Taxation can also act as a disincentive to the
owners of the factors of production. For example, workers might decide to work
less if they are taxed at high marginal or personal income tax rates. These costs
of taxation (economists refer to these costs as the excess burden or
deadweight loss of taxation) have to kept as low as possible. Taxes must not
induce taxpayers to change their behaviour. Thus taxation should have the
minimum possible effect on relative prices, which are the signals on which the
various market participants base their decisions. It must be as neutral as
possible. Refer to page 293 in the textbook.
The correct answer is: taxes have the minimum possible effect on relative
prices.
Question 3
Complete
Mark 1.00 out of 1.00
Which one of the following statements regarding government spending and the
financing of such spending is incorrect?
a. The income received from state-owned enterprises forms part the
sources of revenue for government.
b. The difference between government spending and taxation is called
the budget deficit.
c. Government spending can be financed through taxation and borrowing.
d. Personal income tax is the only source of revenue that can be used to
finance government spending.
Personal income tax is not the only source of government spending
The correct answer is: Personal income tax is the only source of revenue that
can be used to finance government spending.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=20342755&cmid=1019616 2/13
ECS1601-24-Y_AS2 Introduction Assessment 2
QUIZ
Started on Thursday, 25 July 2024, 8:21 PM
State Finished
Completed on Thursday, 25 July 2024, 8:46 PM
Time taken 24 mins 29 secs
Grade 13.00 out of 18.00 (72.22%)
Question 1
Complete
Mark 1.00 out of 1.00
Which of the following elements are regarded as government intervention?
a. Taxation and borrowing only.
b. Spending, interest rate and borrowing.
c. Spending and taxation only.
d. Spending, borrowing and taxation.
The elements of government intervention are spending, taxation, and
borrowing.
The correct answer is: Spending, borrowing and taxation.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=20342755&cmid=1019616 1/13
, 9/18/24, 10:10 PM Assessment 2: Attempt review
Question 2
Complete
Mark 1.00 out of 1.00
Neutrality of taxes means that
a. the recipients generated by a particular government expenditure should
pay for the goods and services concerned.
b. compliance and administration costs are kept as low as possible.
c. taxes have the minimum possible effect on relative prices.
d. the tax burden is spread equally amongst taxpayers.
Taxes affect prices and therefore also the decisions of the various participants
of the economy. As a result, they can distort the allocation of resources and
lower the welfare of society. Taxation can also act as a disincentive to the
owners of the factors of production. For example, workers might decide to work
less if they are taxed at high marginal or personal income tax rates. These costs
of taxation (economists refer to these costs as the excess burden or
deadweight loss of taxation) have to kept as low as possible. Taxes must not
induce taxpayers to change their behaviour. Thus taxation should have the
minimum possible effect on relative prices, which are the signals on which the
various market participants base their decisions. It must be as neutral as
possible. Refer to page 293 in the textbook.
The correct answer is: taxes have the minimum possible effect on relative
prices.
Question 3
Complete
Mark 1.00 out of 1.00
Which one of the following statements regarding government spending and the
financing of such spending is incorrect?
a. The income received from state-owned enterprises forms part the
sources of revenue for government.
b. The difference between government spending and taxation is called
the budget deficit.
c. Government spending can be financed through taxation and borrowing.
d. Personal income tax is the only source of revenue that can be used to
finance government spending.
Personal income tax is not the only source of government spending
The correct answer is: Personal income tax is the only source of revenue that
can be used to finance government spending.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=20342755&cmid=1019616 2/13
