Question

o make the amount of tax revenue collected more predictable, the government decides to change the tax system from progressive to lump sum, meaning each family pays a set amount of tax per year, independent of the amount of income it is making. In this case, recessions are likely to be ________ and expansions are likely to be ________.

Answer 1

recessions are likely to be MORE SEVERE and expansions LESS EXPANSIONARY.

Step-by-step explanation:

Personally, I believe that the classical economic view that if rich people are allowed to become extremely rich, the economy would benefit is a lie. What makes an economy grow is the middle class, not the upper 0.1%. If the tax rate was flat, then only the rich would benefit, and the vat majority of the population would be hurt, making recessions even worse and economic expansions would be small. The trickle down effect is a fallacy that has never worked and never will work. The idea of returning to the middle ages where the rich controlled the lives of average people is just ridiculous.