O-LevelEconomicsGovernment and the macroeconomy2281/11 · May/June 2020 · Q181 Mark
The government wishes to increase economic growth in its economy. What would not be likely to achieve this aim?
AThe central bank encourages bank lending.
BThe central bank lowers interest rates.
CThe government increases sales tax (VAT).
DThe government subsidises new industries.
✓ Correct answer
C: The government increases sales tax (VAT).
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