The main disagreement among economists about the Laffer curve is about whether

A) increases in taxes will decrease GDP.
B) the effect of tax decreases on GDP will be so big as to raise government revenues when taxes are cut.
C) cutting marginal tax rates will increase the incentive to work.
D) the government will collect maximum tax revenue at a 50% tax rate.

Laffer Curve

A theoretical representation of the relationship between tax rates and the amount of tax revenue collected by governments, suggesting that increasing tax rates beyond a certain point is counter-productive for raising tax revenue.

GDP

Stands for Gross Domestic Product, a measure of the economic performance of a country, representing the total value of all goods and services produced over a specific time period.

Marginal Tax Rates

The rate at which tax is charged on the last dollar of income earned, indicating the percentage of additional income that will be taxed.