Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 36 - Part XIII - Six Debates over Macroeconomic Policy - Questions for Review - Page 815: 10

Answer

One adverse effect of tax incentives to save is that of ensuring economic prosperity.

Work Step by Step

We save today to bequeath those funds to other people. However, the estate tax rate could be as large as 40%. This tax provides a disincentive to save.
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