Fiscal Policy - The Laffer Curve
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Fiscal Policy - The Laffer Curve
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tutor2u.net
The Laffer Curve illustrates the theoretical relationship between tax rates and government tax revenue, suggesting that revenue is zero at both 0% and 100% tax rates, with an optimal rate somewhere in between that maximizes revenue, forming an inverted U-shape. Cutting tax rates from very high levels can sometimes increase total revenue (the "normal range") by incentivizing work and investment, while raising rates from very low levels also increases revenue (the "prohibitive range"). The concept
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The relation between Laffer curve and supply side economics.
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SOLVED:What is the Laffer Curve, and how does it relate to supply-side economics? Why is determining the economy's location on the curve so important in assessing tax policy?
SOLVED:What is the Laffer Curve, and how does it relate to supply-si…
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