A Reduction in the Marginal Tax Rate Includes a Substitution

question 27

True/False

A reduction in the marginal tax rate includes a substitution effect that tends to increase savings.

---

Definitions:

Personal Liberties

The fundamental rights and freedoms that individuals possess, which are protected by law from government interference.

Individual Rights

Rights that individuals are entitled to as persons, regardless of their membership in various groups, which may include the right to life, liberty, and the pursuit of happiness.

Declaration of Independence

The document in which the Thirteen Colonies declared themselves independent from British rule in 1776.

Allegiance

Loyalty or commitment of an individual to a group, cause, or nation.