Moderate

Most American cities have_________________?

Correct answer: D. a reduced tax base

  • A. large shopping malls
  • B. many high income taxpayers
  • C. continual building of new industries
  • D. a reduced tax base

Explanation

Suburbanisation drew residents and businesses away from central cities, often leaving them with fewer taxpayers and a reduced tax base. Shopping malls and industrial growth do not describe most American cities as broadly as this fiscal effect does.

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Government revenue and expenditure are analysed through taxation, public borrowing, budgets, subsidies, transfers and public debt. The topic explains how fiscal policy affects resource allocation, income distribution, economic stability and growth, while distinguishing direct from indirect taxes, progressive from regressive taxation, and public goods from goods supplied by private markets.

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