Question 1
According to the Laffer curve, a decrease in the tax rate will increase tax revenue
◦ if the economy is on the positively sloped section of the curve.
◦ if the economy is on the negatively sloped section of the curve.
◦ if the economy is at the farthest point out on the curve.
◦ no matter the location of the economy on the curve.
Question 2
The Economic Recovery Tax Act of 1981 allowed firms to ________ their capital at a ________ for tax purposes. This decreased tax liability and encouraged investment.
◦ depreciate; slow and consistent rate
◦ depreciate; very rapid rate
◦ appreciate; slow and consistent rate
◦ appreciate; very rapid rate
Economic and Social Development
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