In 2010, the cochairmen of President Obama's deficit reduction commission proposed curtailing or eliminating many tax deductions such as the one for mortgage interest. Economists who favor the proposal argue that it would (iii) encourage private philanthropy.

Question

In 2010, the co­chairmen of President Obama's deficit reduction commission proposed curtailing or eliminating many tax deductions such as the one for mortgage interest. Economists who favor the proposal argue that it would (iii) encourage private philanthropy.

Quizplus · Accepted Answer

The proposed plan to curtail or eliminate tax deductions such as the one for mortgage interest will likely generate more revenue for the government. This would help in reducing the federal deficit, which is an option in (i) only. The economists who support the proposal argue that it would encourage private philanthropy since it is expected that taxpayers who can no longer benefit from some deductions would likely redirect their charitable contributions towards philanthropy, and this is an option under (ii) only. Therefore, the correct answer is option C, which includes (i) and (ii) only.

In 2010, the Co­chairmen of President Obama's Deficit Reduction Commission

In 2010, the Cochairmen of President Obama's Deficit Reduction Commission