During the Reagan administration, the Laffer curve was used to ague that:
A) the supply-side effects of tax cuts are relatively small.
B) discretionary tax cuts are unwise because they create stagflation.
C) lower income tax rates could increase tax revenues.
D) a "flat tax" would simplify the tax code and stimulate economic growth.

Question

Quizplus · Accepted Answer

The Laffer curve argued that lower income tax rates could increase tax revenues by stimulating economic growth and increasing overall tax revenue, as people would have more money to spend and invest. This idea was used during the Reagan administration to support tax cuts as a way to stimulate the economy and increase revenues.

During the Reagan Administration, the Laffer Curve Was Used to Ague