Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Theincome taxforpeoplewhomake$50kto$100k ayearwasincreasedandisnowsetataflat tax rate of $15k. (For the question parts below, feel free to make several plots if you think that makes your answers

  1. Theincome taxforpeoplewhomake$50kto$100k ayearwasincreasedandisnowsetataflat tax rate of $15k. (For the question parts below, feel free to make several plots if you think that makes your answers more clear.)
  2. Plotthemarketforlaborforpeoplewhomakethismuchmoneyperyear. Identifythe market equilibrium. Make sure to label all parts of your plot. (6 points)
    1. On your plot, show how the income tax changes the labor market and market equilibrium.Showthetaxrate.(Assumethatitiseasytofindanewjob.)(4points)
    2. Withareasonyourplot,indicatehowmuchoftheincometaxinbornebyemployees, how much is borne by employers, and the total income tax revenue given to the government. (3 points)
    3. Whatisthewage/salarythatworkerstakehome?(Labelonyourplot.)(1point)
    4. Whyissomeoftheincometaxbornebyemployersifemployees arerequiredtopaythe tax? (2 points)
    5. Underwhatconditionwouldemployeespay100%oftheincometax?Showthiswitha plot. (2 points)
    6. Underwhatconditionwouldemployerspay100%oftheincometax?Showthiswitha plot. (2 points)
    7. Isthisincometaxjustified,ifthesocialplanner'sgoalistoincreasesocialwelfare?(2 points)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction to Global Business Understanding the International Environment & Global Business Functi

Authors: Julian Gaspar, James Kolari, Richard Hise, Leonard Bierman, L. Smith, Antonio Arreola Risa

2nd edition

1305501187, 9780547152127, 547152124, 9781111824259, 1111824258, 978-1305501188

More Books

Students also viewed these Economics questions

Question

1. Build trust and share information with others.

Answered: 1 week ago