Press Enter

Share with your friends and help them crack UPSC!

Or Share on


Correct Option is Tax revenue and tax rate

Learning: It shows the relationship between tax rates and the amount of tax revenue collected by governments.
The Laffer Curve suggests that, as taxes increase from low levels, tax revenue collected by the government also
It also shows that tax rates increasing after a certain point (T*) would cause people not to work as hard or not at
all, thereby reducing tax revenue.
Eventually, if tax rates reached 100%, shown as the far right on his curve, all people would choose not to work
because everything they earned would go to the government.  

Get access to all of our verified questions