Suppose the tax amount on the first $10,000 income is $0; $2000 on the next $20,000; $4000 on the next $20,000; $6000 on the next $30,000; and 40 percent on any income over $80,000. Family A has income of $30,000 and Family B has income of $80,000 What is the marginal and average tax rate for each family?
A) Family A: marginal—10 percent; average—6.7 percent; Family B: marginal—30 percent; average—15 percent.
B) Family A: marginal—10 percent; average—20 percent; Family B: marginal—30 percent; average—23 percent.
C) Family A: marginal—10 percent; average—10 percent; Family B: marginal—40 percent; average—40 percent.
D) Family A: marginal—10 percent; average—15 percent; Family B: marginal—40 percent; average—20 percent.
A
You might also like to view...
If a perfectly competitive firm's price is above its average total cost, the firm
A) is incurring a loss. B) should shut down. C) is earning a profit. D) is breaking even.
Assume we have a simplified banking system in balance-sheet equilibrium. Also assume that all banks are subject to a uniform 10 percent reserve requirement and demand deposits are the only form of money. A commercial bank receiving a new demand deposit of $100 would be able to extend new loans in the amount of:
a. $10 b. $90. c. $100 d. $1,000.
After a negative demand shock, what are the expected long-run adjustments?
a. Wages rise, price level rises, and output falls back to potential b. Wages fall, price level rises, and output falls back to potential c. Wages fall, price level falls, and output increases back to potential d. Wages fall, price level rises, and output increases back to potential e. Wages rise, price level falls, and output increases back to potential
To derive the marginal physical product of capital,
a. all other resources must be held fixed b. capital must be held fixed c. all resources, including capital, must be held fixed d. all resources are variable e. output must be held fixed