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Causes
- Increase in Income Tax
- Increase in Profit Tax
- Increase in Indirect Tax
- Increase in Interest Rates
- Increase in Government Spending
- Increase in the Money Supply
- Government Interest in Education and Training
- Government Provision of Subsidies to businesses to Locate in a particular area
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Effects
- Unfavourable- Less income to spend on goods
- Unfavourable- Less retained profits
- Unfavourable-Cost of production increases, less profits
- Unfavourable- Cost of borrowing increases, increase costs
- Favourable- More public sector employment
- Favourable- Money borrowed more easily, increase spending
- Favourable- Workers more skilled, Increase productivity
- Favourable- Lower cost of production
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