400wn where wn is the after-tax wage rate. Assume that the before-tax wage rate is fixed at $36 (i.e., that before-tax wages do not change in response to income taxes and that labor supply bears the entirety of both statutory and economic burden). a. [2 points] Write a formula for person's annual income tax payment as a function of the tax rate, t, where t can range from 0 to 1 (i.e., from 0% to 100% ). It may help to break this into steps: i. Write a formula for the after-tax wage rate as a function of the tax rate. Reminder: the before-tax wage rate is $36 per hour. ii. Now that you have a formula for the after-tax wage rate, write a formula for the person's annual labor supply as a function of the tax rate (i.e., plug your formula for the after-tax wage rate in for wn in the labor supply equation given at the beginning of the problem). iii. Now that you have a formula for the person's annual labor supply, write a formula for the person's annual income (i.e., the product of labor supply and the pre-tax wage rate) as a function of the tax rate. iv. Now that you have a formula for the person's annual income, write a formula for the person's annual tax payment (i.e., the product of the tax rate and annual income) as a function of the tax rate. 400wn where wn is the after-tax wage rate. Assume that the before-tax wage rate is fixed at $36 (i.e., that before-tax wages do not change in response to income taxes and that labor supply bears the entirety of both statutory and economic burden). a. [2 points] Write a formula for person's annual income tax payment as a function of the tax rate, t, where t can range from 0 to 1 (i.e., from 0% to 100% ). It may help to break this into steps: i. Write a formula for the after-tax wage rate as a function of the tax rate. Reminder: the before-tax wage rate is $36 per hour. ii. Now that you have a formula for the after-tax wage rate, write a formula for the person's annual labor supply as a function of the tax rate (i.e., plug your formula for the after-tax wage rate in for wn in the labor supply equation given at the beginning of the problem). iii. Now that you have a formula for the person's annual labor supply, write a formula for the person's annual income (i.e., the product of labor supply and the pre-tax wage rate) as a function of the tax rate. iv. Now that you have a formula for the person's annual income, write a formula for the person's annual tax payment (i.e., the product of the tax rate and annual income) as a function of the tax rate
