Question

The laffer curve makes the point that cutting a very high marginal tax rate can __________ the tax base enough so that tax revenues actually __________.

Answer 1

The laffer curve makes the point that cutting a very high marginal tax rate can raise the tax base enough so that tax revenues actually rise. The Laffer Curve is a theory that was developed by Arthur Laffer. The theory explains the relationship between tax rates and how much tax revue the government creates.