High marginal tax rates, such as those instituted during the Great Depression, will
A) increase the incentive of people to earn.
B) lead to a proportional increase in tax revenue and a reduction in the size of the budget deficit.
C) cause people to work, earn, and invest less than would be the case if marginal tax rates were lower.
D) attract workers from other countries where tax rates are lower.

Question

Quizplus · Accepted Answer

High marginal tax rates reduce the incentive to work, earn, and invest, as individuals keep less of each additional dollar earned, potentially leading to decreased economic activity.

High Marginal Tax Rates, Such as Those Instituted During the Great