Are any of the outlays in Table 4.1 preferable to the others? Support your answer. Table 4.1:
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Table 4.1: Household Organizational Summary
* In some income circumstances, the opposite is true-for example, getting married can be less taxing than staying single.
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Type of Legal Household Single person Married persons Financial Benefits Taxation Life Can be an advantage for income taxation* Can be a disadvantage for income taxation No responsibility for Limited to person Limited to last surviving spouse Specialization Economies of scale Possible reduction in risk of income fluctuation Specialization Economies of scale Possible reduction in risk of income fluctuation Marital responsibilities set by the government Can be an advantage over married persons for income taxation Few legal Unmarried persons Last surviving member unless set by contract recognized by state or local municipality Additional responsibilities set by state Each type with children None extra Extra tax deduction- favorable tax treatment for single-adult head of household in income adult member 2
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