Country had value-added tax instead

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When traveling on vacation recently in a country with a large consumption tax, your textbook author was presented with a deal: pay cash and get a 10% discount. Given that credit card transactions cost the merchant less than 2%, why did the merchant make this offer? Would the merchant be more or less likely to make the offer if the country had a value-added tax instead? Explain.

Reference no: EM131109538

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