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Economics (AS & A Level) · Oct / Nov 2024 · Paper 32 · Question 22

9708Fiscal policy

Which argument for lowering income tax rates is always valid?

  1. AIt boosts economic activity.
  2. BIt promotes the incentive to work.
  3. CIt reduces the budget deficit.
  4. DIt reduces the incentive to evade taxes.

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Correct answer: D. It reduces the incentive to evade taxes.

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