EBK MACROECONOMICS FOR TODAY
9th Edition
ISBN: 8220101425966
Author: Tucker
Publisher: CENGAGE L
expand_more
expand_more
format_list_bulleted
Question
Chapter 20, Problem 1SQ
To determine
The changes in the tax structure.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
suppose Lena makes $50000 per year and Mariah makes $65000 per year. If each pays $5000 in taxes: What would their individual tax rates be? Would you describe this tax system as proportional, progressive, or regressive?
Please don't give wrong answers
Graph two different approaches to government as a function of tax rates.
Chapter 20 Solutions
EBK MACROECONOMICS FOR TODAY
Ch. 20.2 - Prob. 1GECh. 20 - Prob. 1SQPCh. 20 - Prob. 2SQPCh. 20 - Prob. 3SQPCh. 20 - Prob. 4SQPCh. 20 - Prob. 5SQPCh. 20 - Prob. 6SQPCh. 20 - Prob. 7SQPCh. 20 - Prob. 8SQPCh. 20 - Prob. 9SQP
Ch. 20 - Prob. 10SQPCh. 20 - Prob. 11SQPCh. 20 - Prob. 12SQPCh. 20 - Prob. 1SQCh. 20 - Prob. 2SQCh. 20 - Prob. 3SQCh. 20 - Prob. 4SQCh. 20 - Prob. 5SQCh. 20 - Prob. 6SQCh. 20 - Prob. 7SQCh. 20 - Prob. 8SQCh. 20 - Prob. 9SQCh. 20 - Prob. 10SQCh. 20 - Prob. 11SQCh. 20 - Prob. 12SQCh. 20 - Prob. 13SQCh. 20 - Prob. 14SQCh. 20 - Prob. 15SQCh. 20 - Prob. 16SQCh. 20 - Prob. 17SQCh. 20 - Prob. 18SQCh. 20 - Prob. 19SQCh. 20 - Prob. 20SQ
Knowledge Booster
Similar questions
- Let's walk through the median voter theorem in a little more detail. Consider a town with three voters, Enrique, Nandini, and Torsten. The big issue in the upcoming election is how high the sales tax rate should be. As you'll learn in macroeconomics (and in real life), on average, a government that wants to do more spending has to bring in more taxes, so "higher permanent taxes" is the same as "higher government spending." Enrique wants low taxes and small government, Nandini is in the middle, and Torsten wants the biggest town government of the three. Each one is a stubborn person, and his or her favorite position-what economic theorists call the "ideal point-never changes in this problem. Their preferences can be summed up like this, with the x denoting each person's favorite tax rate: Enrique 0% N O Sales tax rate Nandini P Torsten 20% Suppose there are two politicians running for office, N and O (so ignore P for now). Enrique will vote for Choose your answer. Nandini will vote for…arrow_forwardPerson A earns $100,000 per year, while person B earns $45,000 per year. Which conclusion is most likely true for these people when they pay their income taxes? A. Person A will pay at a higher income tax rate than person B. B. Person B will pay at a higher income tax rate than person A. C. Neither person A nor person B will have to pay income tax. D. Both person A and person B will pay at the same income tax rate.arrow_forwardIn 1989, Senator Bob Packwood asked Congress’s Joint Committee on Taxation how much extra revenue the government would raise if it just started taxing 100% of all income over $200,000 per year. The Joint Committee crunched some numbers and reported an answer: $204 billion per year. a. What is wrong with this answer? In 1989, very few people made over $200,000 a year, so the estimate of the tax revenue is far too high. Increasing government spending by $204 billion each year would have generated economic growth, and subsequently even higher amounts of tax revenues. The Joint Committee on Taxation did not have the tools needed to make such an estimate accurately. No one would have an incentive to work once they had earned $200,000, so much of the taxable income would disappear.arrow_forward
- Suppose that the government collected taxes in the following fashion: people who earn less than $50,000 pay 25 percent in taxes, people who earn between $50,000 and $100,000 pay 35 percent in taxes, people who earn between $100,000 and $200,000 pay 30 percent in taxes, and people who earn more than $200,000 pay 28 percent in taxes. Which of the following statements is correct? a. The tax system is proportional for income levels less than $50,000 and regressive for income levels above $50,000. b. The tax system is regressive for income levels less than $100,000 and progressive for income levels above $100,000. c. The tax system is progressive for income levels less than $100,000 and regressive for income levels above $100,000 . d. The tax system is progressive for income levels less than $50,000 and proportional for income levels above $100,000.arrow_forwardWhat is that the people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much and attack them for being wealthy? Why do poor people not have to pay taxes?arrow_forwardDefine progressive tax.arrow_forward
- Is the tax imposed on cigarettes a progressive, proportional, or a regressive form of taxation? Why? What are some other examples of this type of tax?arrow_forwardHow do taxation and government spending impact the economy of a country positively in three ways and negatively in three ways?arrow_forwardWhich of the following government programs are financed by payroll tax? a) Medicare, food stamps, and social security. b) Medicaid, disability insurance, and Medicare. c) Disability, social security, and food stamps. d) Social security, disability, and Medicaid.arrow_forward
- How does a "progressive tax system" differ from a "regressive tax system" in terms of income distribution? A) A progressive tax system imposes higher tax rates on higher incomes, while a regressive tax system imposes higher tax rates on lower incomes. B) A progressive tax system imposes a uniform tax rate on all incomes, while a regressive tax system adjusts rates based on economic cycles. C) A progressive tax system reduces income inequality by taxing higher incomes at higher rates, while a regressive tax system can increase inequality by placing a heavier burden on lower incomes. D) A progressive tax system exempts lower incomes from taxation, while a regressive tax system taxes all incomes at the same rate.arrow_forwardGive a brief example of proportional tax systemarrow_forwardSuppose the city of Strelsau has a 10% property tax on rental properties. Rudolph makes $100,000 a year and pays $21,000 per year in rent. Fritz makes $40,000 per year and spends $10,800 in rent. Both Rudolph and Fritz rent from Michael. a. How is Strelsau's property tax best described? Regressive Proportional Incidental Progressive b. Who most likely actually pays the tax on rental property? The renters, Rudolph and Fritz, pay it. The landlord, Micheal, pays it. It is split evenly between the renters and the landlord. The renters and landlord negotiate who will pay it.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Microeconomics: Principles & PolicyEconomicsISBN:9781337794992Author:William J. Baumol, Alan S. Blinder, John L. SolowPublisher:Cengage Learning
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Microeconomics: Principles & Policy
Economics
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:Cengage Learning