Which of the Following Is an Advantage of a Value-Added

question 12

Multiple Choice

Which of the following is an advantage of a value-added tax (VAT) compared to a tax on retail sales?

• A)The VAT may lead to higher revenue collected because even if no sales takes place, the government collects tax revenue at earlier stages of production.
• B)The VAT is a more equitable tax system because the tax burden is shared by every participant in the production process and by the final consumer.
• C)The VAT encourages productive behavior because each producer bears a smaller portion of the total tax imposed on a product.
• D)The VAT reduces a nation's trade deficit.

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Definitions:

Frequency

The rate at which something occurs over a particular period or in a given sample.

Demand Characteristics

Cues in an experimental setting that influence participants' perceptions or behavior, potentially skewing results.

Perception of Quality

The subjective assessment of a product or service's overall excellence or desirability.

Taste Test

A method of evaluating a food item's flavor, texture, and aroma preferences among consumers.