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CAIE A-Level Economics 8.2.5 Equity and Equality Policies

Practise comparing progressive taxes, negative income tax, universal or means-tested benefits and supply-side measures by their distributional impact, targeting and work…

Syllabus
2026–2028
Course
Economics 9708
Level
A2

Exam points

  • interpret progressive or negative income-tax schedules to compare after-tax distribution
  • compare universal and means-tested benefits through coverage, targeting, cost and poverty traps
  • evaluate fiscal redistribution against education, training or labour-access supply policies

8.2.5—Equity/equality policies question 1

[Maximum number: 1]

A government has a policy where income tax is paid only after the first $ 20000 of income has been earned.

What would make the government's policy more equitable?

A

Decreasing the threshold for paying income tax to $ 10000 for all taxpayers.

B

Integrating the tax and welfare systems by introducing a negative income tax.

C

Introducing universal benefits that are available to all citizens irrespective of wealth.

D

Means testing all benefits so that they remain the same even if real incomes fall.

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