The Laffer Curve Shows the Relationship Between Tax

question 63

Multiple Choice

The Laffer curve shows the relationship between tax:

• A) revenue and tax rates.
• B) revenue and take-home pay.
• C) revenue and government spending.
• D) rates and take-home pay.
• E) rates and government spending.

---

Definitions:

Operating Cycle

The duration it takes for a company to purchase inventory, sell products, and receive cash from sales, indicating the company's efficiency in managing its core operations.

Inventory Period

The average time it takes for inventory to be sold and replaced over a period, a key component of efficiency in supply chain management.

Accounts Payable Period

The average duration it takes for a company to pay off its suppliers after receiving goods or services.

Accounts Receivable Period

The mean duration that a company requires to receive payments from credit sales, reflecting the effectiveness of its policies on credit and collections.