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Government G levies an income tax with the following rate structure: Percentage Rate Bracket 6% Income from 0 to $30,000 10 Income from $30,001 to

Government G levies an income tax with the following rate structure:

Percentage Rate Bracket
6% Income from 0 to $30,000
10 Income from $30,001 to $70,000
20 Income from $70,001 to $200,000
28 Income in excess of $200,000

Taxpayer O earns $45,500 annually during years 1 through 10. Taxpayer P earns $15,000 annually during years 1 through 5 and $76,000 annually during years 6 through 10. Assume the tax rate bracket has not changed.

Required:

  1. How much total income does each taxpayer earn over the 10-year period?
  2. Compute each taxpayers average tax rate for the 10-year period.

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