Economist A believes that if tax rates are cut,tax revenue is likely to rise. This economist most likely believes that

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Economist A believes in the theory of "Laffer curve", which suggests that beyond a certain point, a decrease in tax rates can potentially increase tax revenue as it stimulates economic growth and incentivizes people to work and invest more. However, the decrease in tax rates should not be too big that it causes a significant decline in tax revenue. Therefore, Economist A most likely believes that the percentage decrease in tax rates will be smaller than the percentage rise in tax revenue. Option A and D are incorrect because they suggest a larger time lag or smaller effect of tax rate cuts on tax revenue, which is not a part of the Laffer curve theory. Option B suggests an equal effect on both sides of the curve, which is not supported by any empirical evidence.

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