Congress would like to increase tax revenues by 5.5 percent. Assume that the average taxpayer in the United States earns $56,000 and pays an average tax rate of 20 percent. Required: If the income effect is in effect for all taxpayers, what average tax rate will result in a 5.5 percent increase in tax revenues? Note: Round your answer to 2 decimal places.

Congress would like to increase tax revenues by 5.5 percent. Assume that the average taxpayer in the United States earns $56,000 and pays an average tax rate of 20 percent. Required: If the income effect is in effect for all taxpayers, what average tax rate will result in a 5.5 percent increase in tax revenues? Note: Round your answer to 2 decimal places.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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