Economics 9708 · AS & A Level · Maximum and minimum prices

Maximum and minimum prices — practice question

A government wants to reduce tax avoidance. Which policy used to do this would illustrate the behavioural approach of nudge theory?

  • Acompelling direct tax deduction by employers
  • Bmaking random inspections of individual tax records
  • Cproviding information on how the tax is spent by the government
  • Dusing penalties, such as fines and imprisonment for tax avoidance

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