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QuizMultiple Choice

Fiscal Policy — Quiz

Question 1 • Government

In addition to raising money, the government imposes excise taxes to

Answer
A
discourage the use of specific products.
B
protect manufacturers of specific products.
C
protect consumers from specific products.
D
encourage the use of specific products.

Explanation

Excise taxes are charged on particular goods, such as tobacco, alcohol, or gasoline. Raising the price can reduce demand for those goods, so governments may use these taxes to discourage people from using specific products. The correct choice is “discourage the use of specific products.”

AI-written and checked against the verified answer.

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