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Consider a person 25 years old who is considering saving $1,000. If he puts this money in a savings account that earns 8 percent and leaves it there, he would have $21,720 when he retires at age 65. Yet if the government taxes one-fourth of his interest income each year, the effective interest rate is only 6 percent. After 40 years of earning 6 percent, the $1,000 grows to only $10,290, less than half of what it would have been without taxation. Thus, because interest income is taxed, saving is much less attractive.

Some economists advocate eliminating the current tax systems disincentive toward saving by changing the basis of taxation. Rather than taxing the amount of income that people earn, the government could tax the amount that people spend.

Under this proposal, all income that is saved would not be taxed until the saving is later spent. This alternative system, called a consumption tax, would not distort peoples saving decisions.

Various provisions of the current tax code already make the tax system a bit like a consumption tax. Taxpayers can put a limited amount of their saving into special accountssuch as Individual Retirement Accounts and 401(k) plansthat escape taxation until the money is withdrawn at retirement. For people who do most of their saving through these retirement accounts, their tax bill is, in effect, based on their consumption rather than their income.

European countries tend to rely more on consumption taxes than does the United States. Most of them raise a significant amount of government revenue through a value-added tax, or a VAT. A VAT is like the retail sales tax that many U.S. states use, but rather than collecting all of the tax at the retail level when the consumer buys the final good, the government collects the tax in stages as the good is being produced (that is, as value is added by firms along the chain of production). Various U.S. policymakers have proposed that the tax code move further in direction of taxing consumption rather than income. In 2005, economist Alan Greenspan, then Chairman of the Federal Reserve, offered this advice to a presidential commission on tax reform: As you know, many economists believe that a consumption tax would be best from the perspective of promoting economic growthparticularly if one were designing a tax system from scratchbecause a consumption tax is likely to encourage saving and capital formation. However, getting from the current tax system to a consumption tax raises a challenging set of transition issues.

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Q2 : 3000 4000 2021 (LRI) 14 2021.

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Case: FBI

Please read the case FBI from Chapter 10 ABILITY Page: - 328 given in your textbook Organizational behaviour: Improving performance and commitment in the workplace (6th ed). by Colquitt, J. A., LePine, J. A., & Wesson, M. J. (2019) and Answer the following Questions:

Assignment Question(s):

1. Which specific cognitive and emotional abilities are likely to be most important for FBI special agents? Explain. (Min words 150-200)

2. Identify the specific physical abilities that are assessed in the FBIs annual physical fitness test. Describe the responsibilities of special agents for which these abilities are likely to be most important. (Min words 150-200)

3. How might the frequency of various special agent responsibilities make it important to test for physical abilities (but not cognitive or emotional abilities) on an annual basis? Explain.

(Min words 200)

Part:-2

Discussion question: - Please read Chapter 10 ABILITY Carefully and then give your answers on the basis of your understanding.

4. What combination of abilities is appropriate for the job of your dreams? Do you possess those abilities? If you fall short on any of these abilities, what could you do to improve? (Min words 200-300)