Figure 11-2

-Which graph in Figure 11-2 best reflects a supply-sider's view of the impact of an increase in the personal income tax rate?
A)1
B)2
C)3

Question

Figure 11-2
​ 
-Which graph in Figure 11-2 best reflects a supply-sider's view of the impact of an increase in the personal income tax rate?
A)1 
B)2 
C)3

Quizplus · Accepted Answer

Graph 1 best reflects a supply-sider's view because it shows a decrease in supply (or a leftward shift of the supply curve) as a result of an increase in the personal income tax rate. Supply-siders believe that higher taxes discourage work, investment, and production, leading to a decrease in the overall supply of goods and services.

Figure 11-2 ​

Figure 11-2