1.1. In a recent study the top 20 percent of Americans had 49.7 percent of the income before taxes and transfers and 48.3 percent after taxes and transfers. The same figures for the bottom 20 percent were 3.4 percent and 4.3 percent respectively.

a. How much do taxes and transfers “cost” the upper quintile?

b. How much discretionary income should they be willing to invest to change this situation?

c. How much discretionary income does the bottom quintile have to prevent such a change?