*WAEC ECONOMICS* *NUMBER EIGHT* (8a) A regressive system of taxation is one in which the tax rate decreases as the taxpayer's income increases. This means that lower-income earners pay a higher percentage of their income in taxes compared to higher-income earners. It places a greater burden on the poor than the rich. (8bi) Economy: This principle emphasizes that the cost of collecting a tax should be low relative to the revenue generated. The tax system should not require excessive administrative expenses or burden the taxpayers unnecessarily. (8bii) Certainty: This principle means that taxpayers should know exactly how much tax they are expected to pay, when to pay it, and how to pay it. The rules should be clear, consistent, and not arbitrary to avoid confusion and abuse. (8biii) Equity: Equity means fairness in taxation. It implies that individuals should pay taxes based on their ability to pay. The rich should contribute more than the poor (vertical equity), and those in similar financial situations should pay similar taxes (horizontal equity). (8c) (PICK ANY THREE) (i) To raise revenue for government expenditure. (ii) To redistribute income and reduce inequality. (iii) To control inflation by reducing disposable income. (iv) To protect local industries (e.g., through import duties). (v) To discourage the consumption of harmful goods (e.g., tobacco, alcohol). (vi) To influence investment decisions. (vii) To fund infrastructure and public services. *WAEC ECONOMICS* *NUMBER SEVEN* (7a) (PICK ANY THREE) (i) Treasury Bills (ii) Commercial Papers (iii) Certificates of Deposit (iv) Repurchase Agreements (Repos) (v) Bankers’ Acceptances (vi) Call Money (7bi) Money Market: A manufacturer will seek short-term funds from the money market to meet immediate or temporary financial needs such as purchasing raw materials, paying workers’ salaries, or financing daily operations. Example: A manufacturer facing a cash flow gap before receiving payment from customers may use a treasury bill or commercial paper for short-term financing. (7bii) Capital Market: A manufacturer will seek long-term funds from the capital market to finance major projects such as expansion, purchase of machinery, construction of a new factory, or acquisition of fixed assets. Example: A manufacturer may issue bonds or shares to raise funds for building a new production plant. (7c) (PICK ANY THREE) (i) Provision of long-term loans: Development banks provide long-term financing to sectors like agriculture, industry, and infrastructure. (ii) Promotion of industrial development: They support the establishment and growth of industries, especially in underdeveloped areas. (iii) Financing capital projects: They fund major projects such as power plants, roads, and housing, which may not attract private investment. (iv) Technical and managerial assistance: Development banks offer advisory services and training to entrepreneurs. (v) Support for small and medium enterprises (SMEs): They provide credit and support to small businesses that struggle to get loans from commercial banks.