Authors libby rittenberg 820
Bạn đang xem bản rút gọn của tài liệu. Xem và tải ngay bản đầy đủ của tài liệu tại đây (400.04 KB, 1 trang )
is perfectly elastic; the supply curve for good B is a typical,
upward-sloping curve; and the supply curve for good C is perfectly
inelastic. Suppose the federal government imposes a tax of $20 per
unit on suppliers of each good. Explain and illustrate graphically
how the tax will affect the price of each good in the short run. Show
whether the equilibrium quantity will rise, fall, or remain
unchanged. Who bears the burden of the tax on each good in the
short run? (Hint: Review the chapter on the elasticity for a
discussion of perfectly elastic and perfectly inelastic supply curves;
remember that the tax increases variable cost by $20 per unit.)
Case in Point: What Are Marginal Tax Rates
We speak often of the importance of tax rates at the margin—of how much
of an extra dollar earned through labor or interest on saving will be kept
by the decision-maker. It turns out, however, that figuring out just what
that marginal tax rate is is not an easy task.
Consider the difficulty of untangling just what those marginal tax rates are.
First, Americans face a bewildering complex of taxes. They all face the
federal income tax. Each state—and many cities—levy additional taxes on
income. Then there is the FICA payroll tax, federal and state corporate
income taxes, and excise taxes, as well as federal, state, and local sales
taxes. A person trying to figure out his or her marginal tax rate cannot stop
there. Gaining an additional dollar of income will affect not only taxes but
eligibility for various transfer payment programs in the level of payments
the individual or household can expect to receive. Given the enormous
complexity involved, it is safe to say that no one really knows what his or
her marginal rate is.
Economists Laurence J. Kotlikoff and David Rapson of Boston University
have taken on the task of sorting out marginal tax rates for the United
Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org
820
