(ii) Suppose Country B is similar to Country A in the amount of government expenditures and the level of real GDP at full employment. But instead of a proportional tax system, Country B has a lump-sum (regressive) tax system that balances the budget at all levels of GDP. Graph the tax revenues for this country. Instructions: Use the tool provided 'Tax revenues' to illustrate the country's tax revenues. Plot the first point of the line where real GDP is $20 billion and the second point where real GDP is $80 billion. Plot only the endpoints of the line. $25 Tools $20 Tax revenues $15 and tax revenues, T (billions)
(ii) Suppose Country B is similar to Country A in the amount of government expenditures and the level of real GDP at full employment. But instead of a proportional tax system, Country B has a lump-sum (regressive) tax system that balances the budget at all levels of GDP. Graph the tax revenues for this country. Instructions: Use the tool provided 'Tax revenues' to illustrate the country's tax revenues. Plot the first point of the line where real GDP is $20 billion and the second point where real GDP is $80 billion. Plot only the endpoints of the line. $25 Tools $20 Tax revenues $15 and tax revenues, T (billions)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![(ii) Suppose Country B is similar to Country A in the amount of government expenditures and the level of real GDP at full employment.
But instead of a proportional tax system, Country B has a lump-sum (regressive) tax system that balances the budget at all levels of
GDP.
Graph the tax revenues for this country.
Instructions: Use the tool provided 'Tax revenues' to illustrate the country's tax revenues. Plot the first point of the line where real GDP
is $20 billion and the second point where real GDP is $80 billion. Plot only the endpoints of the line.
$25
Tools
$20
Tax revenues
$15
$10
G
$5
$20
$40
$60
$80
$100
Real domestic output, GDP (billions)
Government expenditures, G, and tax revenues, T (billions)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5d67c09a-7b32-4fed-886b-83e31c2b79fc%2Ff6c94657-fb4a-45cf-b99f-a9142f1c9847%2Frblttx_processed.png&w=3840&q=75)
Transcribed Image Text:(ii) Suppose Country B is similar to Country A in the amount of government expenditures and the level of real GDP at full employment.
But instead of a proportional tax system, Country B has a lump-sum (regressive) tax system that balances the budget at all levels of
GDP.
Graph the tax revenues for this country.
Instructions: Use the tool provided 'Tax revenues' to illustrate the country's tax revenues. Plot the first point of the line where real GDP
is $20 billion and the second point where real GDP is $80 billion. Plot only the endpoints of the line.
$25
Tools
$20
Tax revenues
$15
$10
G
$5
$20
$40
$60
$80
$100
Real domestic output, GDP (billions)
Government expenditures, G, and tax revenues, T (billions)
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