-The above diagram describes the notion that as tax:
A) revenues increase from zero to 100 percent,tax rates will increase from zero to some maximum level and then decline to zero.
B) rates increase from zero to 100 percent,tax revenue will increase from zero to some maximum level and decline to zero.
C) rates decrease from 100 to zero percent,tax revenue will decrease from 100 percent to a maximum level.
D) rates increase from zero to 100 percent,tax revenue will increase from zero to a maximum level.

Question

-The above diagram describes the notion that as tax:
A) revenues increase from zero to 100 percent,tax rates will increase from zero to some maximum level and then decline to zero. 
B) rates increase from zero to 100 percent,tax revenue will increase from zero to some maximum level and decline to zero. 
C) rates decrease from 100 to zero percent,tax revenue will decrease from 100 percent to a maximum level. 
D) rates increase from zero to 100 percent,tax revenue will increase from zero to a maximum level.

Quizplus · Accepted Answer

The Laffer Curve illustrates that as tax rates increase from zero to 100 percent, tax revenue will initially increase to a certain point and then begin to decline, eventually reaching zero when tax rates are at 100 percent.

-The Above Diagram Describes the Notion That as Tax