Answer to Question #9795 in Finance for kunal

Question #9795
Discuss what might happen in an economy if a government increases income tax rates.
1
Expert's answer
2012-05-22T12:15:03-0400
If a government increases income tax rates:
1) the government revenues will increase
2) it will decrease the economic activity of business, especially the small firms
businessmen.
3) total decrease in economy, decrease of inflation rates or even deflation.

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Comments

Assignment Expert
04.11.19, 16:43

Dear aneeza, You're welcome. We are glad to be helpful. If you liked our service please press like-button beside answer field. Thank you!

aneeza
04.11.19, 16:38

good job this brief answer will help me alot in remembering points for my revision for CAIE

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