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DochEvi [55]
3 years ago
12

4. Two politicians are debating the best ways to spur long-term growth in the nation's real GDP per capita. Candidate X says we

should lower income taxes so that households have more money to spend on goods and services. Candidate Y says we should lower taxes on interest income so that households have more incentive to save. Which candidate has the right idea?
English
1 answer:
o-na [289]3 years ago
6 0

Both candidates could potentially be right. Candidate X is right in that if income taxes are lowered, people will have more available money to spend on goods and services they desire or need. However, candidate Y is also right. Some countries have been able to achieve growth by motivating households to save. Some notable examples are China and Japan. Therfeore, both strategies could work, and their applicability would depend on the specific country we are referring to.

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