mdcat logical reasoning MCQ #68

The government increases the tax on luxury goods. What is a potential effect on the market?

mdcat logical reasoning MCQ #68

  1. Question 1

    Q1. The government increases the tax on luxury goods. What is a potential effect on the market?

    • A) Increased sales of luxury goods
    • B) Decreased demand for luxury goods
    • C) No change in consumer behavior
    • D) Shift to cheaper alternatives

    Answer: Decreased demand for luxury goods

    Explanation: Decreased demand for luxury goods is correct because it matches what the question requires. USAT, HAT and MDCAT analytical sections repeat this pattern.