According to the Laffer Curve

question 91

Multiple Choice

According to the Laffer curve,

• A) an increase in tax rates will always cause tax revenues to increase.
• B) when marginal tax rates are high, an increase in tax rates is likely to cause tax revenues to increase.
• C) when marginal taxes are low, an increase in tax rates will probably cause tax revenues to decline.
• D) when marginal tax rates are high, a reduction in tax rates may increase tax revenue.