Refer to the accompanying table for Waxwania. Government Expenditures, G Tax Revenues, T Real GDP $190 100 $500 190 120 600 190 140 700 190 160 800 190 180 900 a. What is the marginal tax rate in Waxwania? ____percent --The average tax rate? _____percent
Refer to the accompanying table for Waxwania. Government Expenditures, G Tax Revenues, T Real GDP $190 100 $500 190 120 600 190 140 700 190 160 800 190 180 900 a. What is the marginal tax rate in Waxwania? ____percent --The average tax rate? _____percent
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Refer to the accompanying table for Waxwania.
Government Expenditures, G | Tax Revenues, T | Real GDP |
$190 | 100 | $500 |
190 | 120 | 600 |
190 | 140 | 700 |
190 | 160 | 800 |
190 | 180 | 900 |
a. What is the marginal tax rate in Waxwania? ____percent
--The average tax rate? _____percent
b. Suppose Waxwania is producing $600 of real GDP, whereas the potential real GDP (or full-employment real GDP) is $700.
-How large is its budget deficit? $____
-Its cyclically adjusted budget deficit? $____
-Its cyclically adjusted budget deficit as a percentage of potential real GDP?________ percent
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