QUESTION TEXT: Politician: Governments should tax any harmful substance that is…
QUESTION TYPE: Principle
PRINCIPLE: You should tax harmful substances at a high enough rate so that people will use them less.
ANALYSIS: We need our tax to do two things.
First, we need to raise taxes. D and E fail this test.
Second, we want people to stop using the things we tax. A and B fail this test.
___________
- This tax aims to treat the effects of sugar use. We want to discourage sugar use instead.
- We want to affect demand for the product.
- CORRECT. This tax is aimed at persuading people to stop using the substance. Perfect.
- The principle says to raise taxes.
- Same as D. We want to raise taxes, and prevent people from doing bad things.
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