16. Which of the following is NOT a direct effect of high unemployment?
A. Increased poverty
B. Decrease in consumer spending
C. Rise in tax revenue
D. Rise in social welfare needs
Answer (1)
The answer is letter C. Rise in tax revenueWhen people don’t have jobs, they don’t earn income, so they pay little to no taxes. This lowers the government’s ability to fund schools, hospitals, and public services.At the same time, unemployment increases poverty and the need for financial assistance or aid programs. That’s why governments work hard to keep unemployment low—it affects not just individuals, but the whole economy.
