Which of the Following Is an Example of a Transaction-Based

question 5

Multiple Choice

Which of the following is an example of a transaction-based tax?

• A) A tax on net business income
• B) An excise tax
• C) An estate tax on the transfer of assets at death
• D) Both an excise tax and an estate tax on the transfer of assets at death.

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Definitions:

GDP

Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period.

Government Purchases

Expenditures by the government on goods and services that directly consume economic resources, distinct from transfer payments.

Short Run

A period in economics during which some factors of production are fixed, limiting the ability of the economy or a firm to adjust to changes.

Real GDP

The market value of all final goods and services produced within a country in a given period, adjusted for inflation.