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plz help me write these answer. i need this answer ungently. plz help me. Question-4 Suppose that new machines cost $504, and the marginal benefit
plz help me write these answer. i need this answer ungently. plz help me.
Question-4 Suppose that new machines cost $504, and the marginal benefit from new machines is MB = 246 - 6K, where K is the number of machines purchased. The depreciation rate is 5% and the dividend yield (interest rate) is 8%. A. Suppose government imposes CIT rate by 25%. Explain the impact on optimum level of investment in both mathematically and diagrammatically. [5] B. In recent, interest rate decreases to 5% however, depreciation rate increases to 10%. Do you think that government should increase the CIT rate capered to [a] for increasing the economic growth in the long-run? Explain the answer in both mathematically and diagrammatically. [5] Question-5 Consider the income tax schedule follows the structure below: PIT Income Slab Rate (%) 0 10 0 to 20000 20001 to 30000 30001 to 40000 Above than 40000 25 A. Calculate the marginal and average tax rate. Do you think that this tax structure is appropriate to ensure the equity? Explain your answer. [5] B. Do you agree that Ramsey model of optimal taxation will work in this example? Explain your answer by using the diagram. [5] C. If tax structure will be proportionate at 10%. Do you think that tax incidence would increase for the tax payers? Explain by using this example. [5] Step by Step Solution
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