An Increase in Income Tax Rates Will Cause the Interest

question 59

True/False

An increase in income tax rates will cause the interest rates on tax-exempt municipal bonds to fall relative to the interest rate on taxable corporate securities.

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Definitions:

Legislative Action

Legislative action includes the processes and activities through which laws are proposed, considered, modified, and ultimately passed or rejected by a legislative body.

Executive Action

Refers to measures or decisions taken by the executive branch of government, often by a president, governor, or other executive authority.

Strict Scrutiny

A form of judicial review that courts use to determine the constitutionality of certain laws, requiring the law to serve a compelling state interest by the least restrictive means.

Interstate Travel

Moving or transporting people or goods between different states within a country.