Demand and supply for labour in the Mississauga market are given by D = 160 4w and
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Question:
Demand and supply for labour in the Mississauga market are given by D = 160 4w and S = 4w. There is currently a tax of 20 dollars per hour is used to finance an employment training plan called the ETP. A persistent shortfall of tax revenues for funding the ETP, has prompted a government analyst to propose that this payroll tax should be increased to 30 dollars per hour.
a. Provide a labelled diagram, and supplementary calculations to assess the impact of this tax increase on workers, employers and government revenue.
b. Before the tax increase governments earned revenues of ____________. With a tax of 30 dollars per hour government tax revenue is equal to ______________.
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