Suppose that California imposes a sales tax of 10 percent on all goods and services. A Californian
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Suppose that California imposes a sales tax of 10 percent on all goods and services. A Californian named Ralph then goes into a home improvement store in the state capital of Sacramento and buys a leaf blower that is priced at $200. With the 10 percent sales tax, his total comes to $220. How much of the $220 paid by Ralph is in the national income and product accounts as private income (employee compensation, rents, interest, proprietor’s income, and corporate profits)?
a. $220
b. $200
c. $180
d. none of the above
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Related Book For
Macroeconomics
ISBN: 9781264112456
22nd Edition
Authors: Campbell McConnell, Stanley Brue, Sean Flynn
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