Economist A believes that if tax rates are cut,tax revenue is likely to rise.This economist most likely believes that the percentage decrease in tax rates will ______________________________ percentage rise in the tax base.

Question

Quizplus · Accepted Answer

Economist A's belief aligns with the Laffer Curve concept, suggesting that lower tax rates can lead to higher tax revenues by encouraging economic activity and expanding the tax base. Thus, the percentage decrease in tax rates would be smaller than the resulting percentage rise in the tax base, making the tax revenue increase.

Economist a Believes That If Tax Rates Are Cut,tax Revenue