单选题
The Laffer curve indicates that: A. an increase in income tax rates will increase tax revenue. B. a decrease in sales tax rates could increase tax revenue. C. an increase in income tax rates may not increase tax revenue.
【正确答案】
C
【答案解析】The Laffer curve suggests that an increase in income tax rates will increase tax revenues up to a point, and thereafter increases in income tax rates will actually decrease tax revenues. Conversely, a decrease in income tax rates may decrease or increase overall tax revenues, depending upon the initial level of income tax rates.