Question

If the tax on iron is increased, what other things will this affect? Give some examples.

(OR) 

Explain the example given in below picture. Write the relationship between indirect taxes and consumers.

Answer 1

• If the price of iron is increased it will directly affect the price of steel.
• Increase in the price of steel leads to increase in the prices of steel sheets and steel pipes. 
• Increase in steel sheets will lead to increase in steel almirah and increase in price of steel pipes leads to increase in the prices of cycles and the chain goes on.