Chapter 3 Financial Planning Exercise 7 Effect of tax credit vs. tax exemption By defining after-tax income, demonstrate the differences resulting from a $500 tax deduction versus a $500 tax credit for a single taxpayer in the 12% tax bracket with $35,000 of pre-tax income. Round your answers to two decimal places. (Use Exhibit 3.3.) After-tax income with tax deduction $ After-tax income with tax credit