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Economics
MEDIUM
ENGLISH
Economics
According to supply-side economists, as tax rates are reduced, labor supply should increase. This implies that ?
A
there is no income effect when tax rates are changed
Option A
B
the income effect of a wage change is greater than the substitution effect of a wage change.
Option B
C
there is no substitution effect when tax rates are changed
Option C
the substitution effect of a wage change is greater than the income effect of a wage change
Correct answer
Correct answer: D
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