Refer to the Laffer Curve. A cut in the tax rate from T $T _ { 5 } \text { to } T _ { 4 }$ would
A) decrease tax revenues and support the views of supply-side economists.
B) increase tax revenues and support the views of supply-side economists.
C) increase tax revenues and support the views of mainstream economists.
D) decrease tax revenues and support the views of mainstream economists.

Question

Refer to the Laffer Curve. A cut in the tax rate from T $T _ { 5 } \text { to } T _ { 4 }$ would
A) decrease tax revenues and support the views of supply-side economists. 
B) increase tax revenues and support the views of supply-side economists. 
C) increase tax revenues and support the views of mainstream economists. 
D) decrease tax revenues and support the views of mainstream economists.

Quizplus · Accepted Answer

According to the Laffer Curve, a cut in the tax rate from T5 to T4 would lead to increased economic activity and incentivize individuals to work and invest more, thereby increasing tax revenues overall. This view supports the ideas of supply-side economists who argue for lower tax rates to promote economic growth.

Refer to the Laffer Curve T5 to T4T _ { 5 } \text { to } T _ { 4 }T5​ to T4​

Refer to the Laffer Curve $T _ { 5 } \text { to } T _ { 4 }$