According to the Laffer Curve, a Cut in the Tax

question 139

Multiple Choice

According to the Laffer Curve, a cut in the tax rate from above the maximum-revenue rate to a rate lower than the maximum-revenue rate will

• A) decrease real GDP.
• B) increase tax revenues.
• C) decrease tax revenues.
• D) have no effect on tax revenues.

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Definitions:

Surface Chart

A type of chart used in data visualization to represent three-dimensional data; it shows the relationships among three variables.

Cumulative Effect

The overall impact resulting from the addition of several individual effects.

Line Chart

A type of graph that displays information as a series of data points connected by straight line segments.

Data Visualization

The representation of data in a graphical or pictorial format, making it easier to see patterns, trends, and outliers.