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Economics - Financial Markets 10 Online
OpenStudy (anonymous):

What happens to the percentage of an income that is taxed when income rises and the tax is a proportional one? A. The percentage of tax falls. C. The percentage rises and then falls. D. The percentage of tax stays the same

OpenStudy (anonymous):

@Whitemonsterbunny17

whitemonsterbunny17 (whitemonsterbunny17):

Uhhhh where's B? o.O

OpenStudy (anonymous):

it was wrong! @Whitemonsterbunny17

whitemonsterbunny17 (whitemonsterbunny17):

What do you mean? I didn't give you an answer, I just asked where choice B was.. o.O

OpenStudy (anonymous):

B was wrong so I took it out to make it easier that's wht I was saying was wrong @Whitemonsterbunny17

OpenStudy (whpalmer4):

okay, if the tax is 10% of your income, and your income doubles, what happens to the percentage?

whitemonsterbunny17 (whitemonsterbunny17):

Ohh okay, I see. :p

OpenStudy (anonymous):

it doubles @whpalmer4

OpenStudy (whpalmer4):

wait, the question is what happens to the percentage...

OpenStudy (whpalmer4):

if the tax paid is proportional to income, (for example, is a straight 10% of income), and the income doubles, what happens to the percentage?

OpenStudy (anonymous):

it should double?

OpenStudy (whpalmer4):

okay, let's do some numbers. you have a proportional tax. you make 100,000 smackers, and your tax is 10,000 smackers. what is the percentage? next year, you make 200,000 smackers. what is the tax, and what is the percentage?

OpenStudy (anonymous):

10 percent the tax would be 20,000 smackers and the percentage would be 20 right?

OpenStudy (whpalmer4):

\(20,000 \) is what percentage of \(200,000\)?

OpenStudy (anonymous):

20

OpenStudy (anonymous):

no wait 10?

OpenStudy (anonymous):

so is it D ? it will stay the same ?

OpenStudy (anonymous):

@whpalmer4

OpenStudy (whpalmer4):

for it to be proportional, the percentage must stay the same, right?

OpenStudy (anonymous):

yes so it would be D? @whpalmer4

OpenStudy (whpalmer4):

I'll help you work through the concepts, but maybe you could select the answers?

OpenStudy (anonymous):

I am im trying to see if my selection is correct or not? @whpalmer4

OpenStudy (whpalmer4):

Like I said, I'll work through the concepts with you. You'll have to choose the right answer from that. If you can't do so, then you haven't grasped the point. You can however still find out if your selection is correct or not, the same way I did when I was a student: I wrote it down as my answer, and looked at how it was graded!

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