Which of the following statements is false?

[bucstennis@aim.com]

Question 1

Double taxation of saving may

◦ reduce the saving rate.
◦ increase the rate of investment.
◦ increase the rate of economic growth.
◦ increase the budget deficit.

Question 2

Which of the following statements is 
false?

◦ An income tax taxes savings twice only if consumption is the measure used to gauge a person's ability to pay.
◦ Proponents of income as a tax base argue that you should not be taxed on what you draw out of the common pot, but rather on the basis of your ability to draw from the pot.
◦ The double taxation of saving tends to increase the saving rate because people have to save more to keep the after-tax yield constant.
◦ At this time, there is not clear consensus on what the best tax base is.

[Meganchabluk]

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[bucstennis@aim.com]

Gracias!

[lindahyatt42]

Thanks for the timely response, appreciate it