How does double taxation affect consumption, saving and economic growth?
What will be an ideal response?
By double taxing saving, an income tax distorts the choice between consumption and saving which is really the choice between present consumption and future consumption. Double taxation also tends to reduce the saving rate and the rate of investment – and ultimately the rate of economic growth.
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In the long run, a perfectly competitive firm maximizes profit so P = MC = AC.
Answer the following statement true (T) or false (F)
Perfectly competitive markets are:
A. the most common type of market in our economy. B. hard to find in a real world setting. C. made up principally by consumer goods. D. typically found in industrial sectors of our economy.
The use of automated teller machines (ATMs) has caused some bank tellers to lose their jobs. This is an example of
A. cyclical unemployment. B. seasonal unemployment. C. frictional unemployment. D. structural unemployment.
If people who have children also tend to own dogs, we can say there is a positive correlation between having children and dog ownership.
Answer the following statement true (T) or false (F)