During the 2008 presidential campaign, Senator Obama proposed eliminating the income tax for all seniors earning less

Question:

During the 2008 presidential campaign, Senator Obama proposed eliminating the income tax for all seniors earning less than $50,000.

Seniors making above this threshold would still be subject to the income tax, which could potentially mean a tax liability of thousands of dollars. Sketch a budget constraint in a leisure-income diagram that is consistent with this proposal. If this proposal were adopted, what would happen to the labor supply for seniors?

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Related Book For  book-img-for-question

Public Finance

ISBN: 9780073511351

9th Edition

Authors: Harvey Rosen, Robert Guell, Ted Gayer

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