Q1. The Laffer curve begins at:

A)   zero tax revenues and ends at zero tax revenues.

B)   minimum tax revenues and ends at maximum theoretical tax revenues.

C)   zero tax revenues and ends at maximum theoretical tax revenues.

Q2. The idea behind the Laffer curve is that increases in tax rates do not increase tax revenues proportionately because they decrease the:

A)   demand for labor.

B)   supply of labor.

C)   productivity of labor.

Q3. The Laffer curve indicates that:

A)   an increase in income tax rates may not increase tax revenue.

B)   an increase in income tax rates will increase tax revenue.

C)   a decrease in sales tax rates could increase tax revenue.

答案和详解如下：

Q1. The Laffer curve begins at:

A)   zero tax revenues and ends at zero tax revenues.

B)   minimum tax revenues and ends at maximum theoretical tax revenues.

C)   zero tax revenues and ends at maximum theoretical tax revenues.

Correct answer is A)

The Laffer curve begins at zero tax revenues (the tax rate is 0%, so no matter how much labor is supplied, the tax revenue is zero) and ends at zero tax revenues (the tax rate is 100%, so no labor will be supplied, and no tax revenue collected).

Q2. The idea behind the Laffer curve is that increases in tax rates do not increase tax revenues proportionately because they decrease the:

A)   demand for labor.

B)   supply of labor.

C)   productivity of labor.

Correct answer is B)

The Laffer curve is based on the concept that income tax rates affect potential GDP because of their influence on the supply of labor. Hence, the name "supply-side" economics.

Q3. The Laffer curve indicates that:

A)   an increase in income tax rates may not increase tax revenue.

B)   an increase in income tax rates will increase tax revenue.

C)   a decrease in sales tax rates could increase tax revenue.

Correct answer is A)

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.

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