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)