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The Laffer Curve
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The Laffer Curve
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6. Introduction to Taxes and Subsidies / The Laffer Curve / Problem 7
Problem 7
How might policymakers use the Laffer Curve to inform tax policy decisions?
A
By identifying tax rates that maximize revenue without harming economic activity.
B
By ignoring the relationship between tax rates and revenue.
C
By setting tax rates at zero to maximize economic activity.
D
By increasing tax rates indefinitely to maximize revenue.
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