Dynamic forecasting does not take into consideration taxpayers' responses to a tax change when estimating tax revenues.

Question

Quizplus · Accepted Answer

Dynamic forecasting takes into consideration taxpayers' responses to changes in tax policy, as it considers how individuals and businesses may alter their behavior in response to changes in tax rates or regulations. Therefore, the statement that dynamic forecasting does not take these responses into account is false.

Dynamic Forecasting Does Not Take into Consideration Taxpayers' Responses to a Tax