One of the primary research results in tax policy analysis over the last 20 years is that
A)an increase in interest rates will increase saving.
B)an increase in interest rates will decrease saving.
C)lowering taxes on interest income will increase saving.
D)None of the above.

Question

Quizplus · Accepted Answer

Research has shown that the relationship between interest rates, taxes on interest income, and saving is complex and not as straightforward as the options suggest. Various factors, including income and substitution effects, influence saving behavior, making it difficult to generalize the impact of interest rates or tax changes on saving.

One of the Primary Research Results in Tax Policy Analysis