By how much did the disposable income of rich people increase as a result of the 2017 drop in the top marginal tax rate from 39.6 percent to 37 percent? Assume rich people have $2 trillion of gross income in the highest bracket.

Q: The economy of Dream Island, which is isolated from the rest of the world, has the supply of…

A: Demand curve for the loanable fund shows the level of demand for loan at different interest rate.…

Q: The table shows an economy's demand for loanable funds and supply of loanable funds schedules when…

A: Loanable funds are defined as the theory for determining the rate of interest in the market. The…

Q: The FICA (Federal Insurance Contribution Act) income cap is the point at which one’s income is no…

A: a) Scrap the cap:- As per the statement given, those who are earning more than $142800 will no…

Q: Does the amount of government spending in an economy respond directly to changes in aggregate…

A: The instruments of fiscal policy are government taxation and spending. To accomplish different…

Q: Consider an economy in which tax collections are always $400 and in which the four components of…

A: Given the table, To find the equilibrium of this economy graphically, graph AE curve and the…

Q: The table sets out the data for an economy when the government's budget is balanced. The quantity of…

A: If the government budget is in deficit it decreases the supply of loanable funds which raises the…

Q: Economist Arthur Laffer famously pointed out that, in some cases, income tax revenue can actually go…

A: As the tax rate goes down, expectation of tax aversion or tax avoidance likewise goes down. Each…

Q: Why will a temporary tax increase be insignificant in reducing consumption expenditures by the…

A: Consumption reflects the total expenditure made on the goods and services consumed in an economy.…

Q: The graph below depicts an economy where a decline in aggregate demand has caused a recession.…

A: A multiplier broadly means that an economic factor that, when changed, results to changes in several…

Q: If a tax rate of 1/3 of national income were introduced, what would be the new equilibrium level of…

A: C = 10 + 0.75Y  I = 20 G = 40    Now; T (taxes) = 1/3*Y or 0.33Y   Thus; C = 10 + 0.75(Y-T)

Q: Based on the table and graph, explain how the country's rate of GPD growth has compared to its debt…

A: GDP is defined as the value of the final goods and services produced within the national boundaries…

Q: C = 450 + 0.4Y I = 350 G = 150 X = 70 Z = 35 + 0.1Y T = 0.15Y Yf = 1550     Calculate the…

A: Tax revenue is the percentage of the GDP (Y) which tells about that share, that is collected by the…

Q: Consumers of a country spend 83.21% of their disposable income. If the government wants to increase…

A: The tax multiplier would result in the change in the tax which would create a multiplier effect…

Q: INTEREST RATE (Percent) Supply Demand LOANABLE FUNDS (Billions of dollars) Demand O Supply (?)…

A: Loanable funds refer to the pool of financial resources available for borrowing and lending in…

Q: In the economy of Akron, the tax and savings functions are as follows: T=220+0.2Y S=-140+0.3Y a)…

A: The consumption function is an economic concept that shows the relationship between consumer…

Q: Trace out the effect of increase in government expenditure on equilibrium output and the interest…

A: Government spending: - government spending is the expenditure made by the government on the purchase…

Q: What role taxes policy plays in determining the GDP or national income in an economy? Explain with…

A: Taxes play a crucial role in determining GDP or national income. It helps the government finance…

Q: For the last time, consider the economy described above. You won't work directly with its numbers in…

A: Given;  Government spending= $1000 Net taxes= $1500 Output=$8000 Consumption=$3500 MPC=0.8 And…

Q: Assume that in a given country, tax revenues, T, depend on income, I, according to the formula T= -…

A: Tax income is the pay that is gathered by state run administrations through tax assessment. Tax…

Q: Why will a temporary tax increase be insignificant in reducing consumption expenditures by the…

A: Taxes are obligatory commitments that a government office, whether nearby, provincial, or…

Q: Give two examples each of revenue eceipts and capital receipts in a financial pudget.

A: According to the given question Financial budget in economics is known as a budget which predicts…

Q: Explain government crowding out and how it occurs. How do government surpluses affect real interest…

A: The answer and explanation for both these questions is as follows:-

Q: Why $100 spent by government brings a larger increase in the equilibrium level of income than $100…

A: The value of government purchase multiplier is: The tax multiplier is:

Q: Suppose the government decides to borrow money. The equilibrium interest rate will _____ and the…

A: The following problem has been answered as follows:

Q: How much more output does the $20 trillion U.S economy produce when GDP increases by 1.0 percent?

A: Output – it the total amount of commodities or services produced in a particular time period.…

Q: If  taxes are increased, will most people save more or less than before? Does national saving rise…

A:

Q: What are the justifications for imposing tax on consumption instead of income by the government of…

A: Consumption tax argue that it encourages saving and investment and makes the economy more efficient.…

Q: For an economy, the following information is given to you. C = 0.7(1 - t)Y I= 300-0.02r M"/P 2+0.2Y…

A: The IS-LM (Investment Savings-Liquidity preference Money supply) model focuses on the equilibrium of…

Q: One last time, please consider a closed economy with the following information: • Economic…

A: GDP is the market value of goods and services produced within an economy within a given period of…