1.5 There are three income earners in society, and all three must pay income taxes.The taxable income of Smith is $40,000, the taxable income of Jones is $100,000, and the taxable income of Brown is $200,000.

a How much tax revenue is raised under a proportional income tax where the tax rate is 10 percent?

15 percent?

b Would a progressive tax with a rate of 5 percent on an income of $0–$40,000, a rate of 8 percent on everything over $40,000 and under $100,000, and a rate of 15 percent of everything over $100,000 raise more or less tax revenue than a proportional tax rate of 10 percent? Explain your answer.