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A Higher Rate Is Most Likely to Decrease the Amount

question 272

Multiple Choice

A higher rate is most likely to decrease the amount of revenue that the government collects from an excise tax if demand is _____ and supply is _____.


Definitions:

Banks

Financial institutions licensed to receive deposits, offer loans, and provide various other financial services.

Repay

To pay back or return money that was borrowed from a person, bank, or financial institution.

Risk

The potential for loss or the chance that an investment's actual return will differ from the expected return.

Uncertainty

A situation characterized by the lack of predictability or definite knowledge about an outcome or result.

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