The table shows the distribution of market income in an economy. The government redistributes income by...
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The table shows the distribution of market income in an economy. The government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent; and paying the tax collected as benefits distributed equally to the 40 percent of the population with lowest market income. The cost of administrating the redistribution scheme takes 50 percent of the taxes collected. Complete the table. >>> Answer to 1 decimal place. Households Lowest 20 percent Second 20 percent Third 20 percent Fourth 20 percent Highest 20 percent Market income (percentage of total market income) 5 9 20 30 36 Income tax rate (percentage of household income) 0 10 10 10 Income after tax and benefits (percentage of total income after tax and benefits) The table shows the distribution of market income in an economy. The government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent; and paying the tax collected as benefits distributed equally to the 40 percent of the population with lowest market income. The cost of administrating the redistribution scheme takes 50 percent of the taxes collected. Complete the table. >>> Answer to 1 decimal place. Households Lowest 20 percent Second 20 percent Third 20 percent Fourth 20 percent Highest 20 percent Market income (percentage of total market income) 5 9 20 30 36 Income tax rate (percentage of household income) 0 10 10 10 Income after tax and benefits (percentage of total income after tax and benefits)
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Answer Let us assume that total income of everyone is 100 which means lowest 20 earns ... View the full answer
Related Book For
Microeconomics
ISBN: 978-0321866349
14th canadian Edition
Authors: Christopher T.S. Ragan, Richard G Lipsey
Posted Date:
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