Which of the following statements is correct?
A)A decrease in the size of a tax always decreases the tax revenue raised by that tax.
B)A decrease in the size of a tax always decreases the deadweight loss of that tax.
C)Tax revenue decreases when there is a small decrease in the tax rate and the economy is on the downward-sloping part of the Laffer curve.
D)An increase in the size of a tax leads to an increase in the deadweight loss of the tax only if the economy is on the upward-sloping part of the Laffer curve.

Question

Quizplus · Accepted Answer

The Answer of Which of the following statements is correct?
A)A decrease in the size of a tax always decreases the tax revenue raised by that tax.
B)A decrease in the size of a tax always decreases the deadweight loss of that tax.
C)Tax revenue decreases when there is a small decrease in the tax rate and the economy is on the downward-sloping part of the Laffer curve.
D)An increase in the size of a tax leads to an increase in the deadweight loss of the tax only if the economy is on the upward-sloping part of the Laffer curve.

Which of the Following Statements Is Correct