1
QuizMultiple Choice

Fiscal Policy

Question 1 • *FL-2100310-United States History Semester 1

What happens to the amount of money the government collects in taxes if unemployment is high?

Answer
A
It is harder to collect.
B
It stays the same.
C
It goes down.
D
It goes up.

Explanation

When unemployment is high, fewer people are earning wages, so the government collects less in income taxes. Unemployed people also tend to spend less, which can reduce sales-tax revenue. Therefore, the amount of money the government collects in taxes goes down.

AI-written and checked against the verified answer.

Next