CONNECT F/MICROECONOMICS
21st Edition
ISBN: 2810022151240
Author: McConnell
Publisher: MCG
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Chapter 20, Problem 2P
To determine
Total tax paid, Marginal and average tax rate, progressive tax.
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Suppose you earn $40,000 per year and pay taxes based on marginal tax rates. The first tax bracket, which taxes at 5 percent, ranges
from $0 to $20,000. The second tax bracket, which taxes at 25 percent, ranges from $20,001 to $80,000. How much will you pay in
total taxes?
Instructions: Enter your answer as a whole number.
2$
Suppose in Fiscal illegal there is a 0 percent tax on the first 10,000 of income, but there is a 20% tax on earnings between $10,000 and $20,000 and a 30% tax on income $20,000 and $30,000. Any income above $30,000 is taxed at 40%.
If your income is $70,000, how much will you pay in taxes?
Determine your average tax rate?
Why will direct taxes increase faster than per capita income?
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- Suppose in Fiscalville there is no tax on the first $10,000 of income, but a 20 percent tax on earnings between $10,001 and $20,000 and a 30 percent tax on income between $20,001 and $30,000. Any income above $30,000 is taxed at 40 percent. If your income is $50,000. what is average tax rate ?arrow_forwardSuppose in Fiscalville there is a 0 percent tax on the first $10,000 of income, but there is a 20 percent tax on earnings between $10,000 and $20,000 and a 30 percent tax on income between $20,000 and $30,000. Any income above $30,000 is taxed at 40 percent. Instructions: Round your answers to the nearest whole number. a. If your income is $70,000, how much will you pay in taxes? 2$ b. Determine your marginal tax rate. percent c. Determine your average tax rate. percent d. Is Fiscalville's income tax progressive? (Click to select) Varrow_forwardWhat is the benefit of having state and local taxes on income instead of collecting all such taxes at the federal level? What is the local tax in your county/city? Make sure to state the county/city and the tax rate. How does this compared to the tax rate of neighboring counties/cities? How do you feel about this? Does the location with the higher tax rate receive better amenities (schools, police, road conditions? Would you rather pay a higher tax for better service?arrow_forward
- Suppose in Fiscalville there is a 0 percent tax on the first $10,000 of income, but there is a 20 percent tax on earnings between $10,000 and $20,000 and a 30 percent tax on income between $20,000 and $30,000. Any income above $30,000 is taxed at 40 percent. Instructions: Round your answers to the nearest whole number. a. If your income is $60,000, how much will you pay in taxes? $ 13,000 8 b. Determine your marginal tax rate. 40 percent c. Determine your average tax rate. 21.6 * percent d. Is Fiscalville's income tax progressive? Yesarrow_forwardSuppose in Fiscalville there is a 5 percent tax on the first $10,000 of income, but there is a 15 percent tax on earnings between $10,000 and $20,000 and a 25 percent tax on income between $20,000 and $30,000. Any income above $30,000 is taxed at 35 percent. Instructions: Round your answers to the nearest whole number. a. If your income is $70,000, how much will you pay in taxes? b. Determine your marginal tax rate. percent c. Determine your average tax rate. percentarrow_forwardA R1000 tax payable by all adults could be viewed as both a proportional tax and a regressive tax. Do you agree? Explain.arrow_forward
- 15. Which of the following is a congressional position or organization? the Department of the Treasury comptroller Budget Oversight Committee the United States Office of Management and Budget (OMB)arrow_forwardSuppose taxes are related to income as follows: Income Taxes $1,000 $200 $2,000 $350 $3,000 $450 a. What percentage of income is paid in taxes at each level? b. Is the tax rate progressive, proportional, or regressive? c. What is the marginal tax rate on the first $1,000 of income? The second $1,000? The third $1,000?arrow_forwardDefine Taxation What is Income tax What is a value-added tax What is Sales tax What is an excise tax What is a business tax What is corporate taxarrow_forward
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