ECONOMICS
FEDERAL RESERVE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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An economist might argue that a progressive income tax is effective because it is
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simple
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profitable
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complex
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equitable
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Explanation:
Detailed explanation-1: -Economic efficiency. The argument is that progressive taxation increases worker productivity, yielding greater economic efficiency and higher aggregate incomes.
Detailed explanation-2: -The Laffer Curve displays the relationship between tax rates and tax revenue collected by governments and is often used to illustrate the argument that cutting tax rates can result in increased total tax revenue.
Detailed explanation-3: -Answer and Explanation: The correct answer is b. Benefits foregone by not choosing an alternative course of action. Opportunity cost is the future income or cost that would have been earned or incurred if this alternative was chosen.
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