kmarks Tools Window Help 4519266 Q. Search Jump to... 11/16/201711:55 Pf 0 Quest

Question

kmarks Tools Window Help 4519266 Q. Search Jump to... 11/16/201711:55 Pf 0 Question 8 of 15 Sapling Learning Use the graph below to answer the questions that tollow What curve is shown on the graph? What is represented by point T? The Philips Curve O The Hubbert Curve O The Laffer Curve O The Lorenz Curve O Atar rate of 50%. O Nirvana m»highest possble tax The most tax revenue that can be collected Tax Ral Based on this curve, what is true about tax revenue and the tax rate? o Tax revenue increases as the tax rate increases up to a certain point, beyond which tax Tax revenue decreases as the tax rate increases up to a certain point, beyond which tax O Tax revenue and tax rate have an inverse relasionship revenue decreases as the tax rate increases Tax revenue increases as the tax rate increases. 988 3 4 5 9

Explanation / Answer

1) c) The Laffer curve. It is developerd by arther Laffer to show the relation between tax rate and tax revenue.

2) d) The most tax revenue that can be collected. Point T* shows the maximum amount of tax revenue colllected by the government. The left portion of T* where both tax rate and tax revenue increases. The right portion of T* shows tax rate increases but revenue decreases . In this case people stop working because their income goes to the government as the tax revenue. So government should stay at point T* where revenue is maximized and people wants to work as well.

3) a) tax revenue increases as the tax rate increases up to a certain point,beyond which tax revenue decreases as the tax rate increases.

Related Questions

Navigate

• Browse (All)
• Browse K
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.