8 Consider your decision about how many hours to work. a Draw your budget constraint assuming that...

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8 Consider your decision about how many hours to work.

a Draw your budget constraint assuming that you pay no taxes on your income. On the same diagram, draw another budget constraint assuming that you pay a 15 per cent income tax.

b Show how the tax might lead to more hours of work, fewer hours or the same number of hours. Explain.

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Principles Of Microeconomics

ISBN: 125206

8th Edition

Authors: Joshua Gans, Stephen King, Martin Byford, N Gregory Mankiw

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