Dynamic Tax Analysis Generally Predicts

Multiple Choice

Dynamic tax analysis generally predicts

A) that the higher the tax rate is, the higher the tax revenue will continue to be into the future.
B) that the higher tax rates lead to higher revenues only to a point at which revenues will begin to decrease due to a diminishing tax base.
C) that lower tax rates will always and continuously lead to increased tax revenues.
D) that lower tax rates are always going to lead to decreased tax revenues.