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Consequences of Rising Unemployment on Government's Finances

Question

Analyse the consequences of rising unemployment on a government’s spending and tax revenue.

Category:

Unemployment

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Preview Answer

I. 🍃Introduction
- Explanation of the topic
- Importance of the issue

II. Pressure on the government budget
- Reasons for the pressure
- Impact on the government budget

III. Tax revenue
- Direct taxes
- Indirect taxes
- Impact on tax revenue

IV. Expenditure on unemployment benefits
- Reasons for the increase
- Impact on the government budget

V. Spending in other areas
- Healthcare
- Education
- Impact on the government budget

VI. Opportunity cost
- Explanation of opportunity cost
- Impact on the government budget

VII. Increasing total demand
- Reasons for increasing total demand
- Impact on the government budget

VIII. Disincentive to work and enterprise
- Explanation of disincentive
- Impact on the government budget

IX. 👉Conclusion
- Summary of the main points
- Implications for the government budget

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