Question

Suppose two candidates for office are debating the best ways to create a long-term growth environment (economic) in the United States and to increase real GDP per capita. Candidate A wants to lower income taxes so that households have more money to spend on goods and services. Candidate B wants to lower taxes on interest income so that households have more incentives to save. Which candidate would you vote for for economic growth and why?

Answer 1

i would support candidate A who wants to lower income taxes so that house holds have more money to spend on goods and services. as we know consumption expenditure creates effective demand in the economy and effective demand leads to increased investment and further employment and income creation so innitiatives taken to make consumption expenditure increase will ultimately help the economy to grow. and savings are considered as likages in the economy so it is better to increase consumption and not savings for economic growth.