Assume the marginal tax rate is 12 percent for the first $40,000 of income, 28 percent for income between $40,000 and $100,000, and 30 percent for any income over $100,000. If Sarah has taxable income equal to $120,000 for the year, what is her tax bill?
A. $36,000.
B. $33,600.
C. $34,000.
D. $27,600.
Answer: D
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Answer the following statement(s) true (T) or false (F)
1. When a two-part tariff is perfectly implemented, the monopoly charges a price that is greater than its marginal cost. 2. For a given quantity, a monopoly's marginal revenue is always greater than the price associated with that quantity. 3. When regulating a natural monopoly one should set the regulatory price such that the monopoly will produce the efficient level of output. 4. Deadweight loss because of a monopoly can be attributed to the fact that monopolies produce at a quantity where the price of the good exceeds the marginal cost of producing the last unit. 5. When there are significant differences among customers, a monopolist will look for opportunities to price discriminate.
Compared to monopoly pricing, an optimal two-part tariff
A) equates marginal revenue and average revenue. B) reduces economic efficiency. C) eliminates the deadweight loss. D) increases consumer surplus.
Which of the following properties is seen in a buy-sell transaction arranged by a pipeline?
a. Pipelines offer to resell gas to consumers even at a loss. b. Gas producers offer to sell gas to the pipelines at a discounted prices. c. Gas producers ration the amounts they supply to the pipelines. d. Pipelines evade the legal ceiling on their transportation charge by bundling the gas with transportation service.
If we included the purchases of used goods in GDP,
a. we would be overestimating GDP b. we would be underestimating GDP c. we would be accurately measuring GDP d. the effect on GDP would vary depending on what year the goods were sold new e. we could offset any measurement problems by also including purchases of stocks and bonds