Is the following statement true or false: If there was a 100% income tax imposed in income above $30,000 and, because of the tax, you worked only enough to earn exactly $30,000, then the tax wouldn't really cost you anything and there would be no excess burden or utility losses associated with the tax. Construct an indifference curve budget-line diagram that clearly illustrates your answer
Is the following statement true or false: If there was a 100% income tax imposed in income above $30,000 and, because of the tax, you worked only enough to earn exactly $30,000, then the tax wouldn't really cost you anything and there would be no excess burden or utility losses associated with the tax. Construct an indifference curve budget-line diagram that clearly illustrates your answer
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Is the following statement true or false: If there was a 100% income tax imposed in income above $30,000 and, because of the tax, you worked only enough to earn exactly $30,000, then the tax wouldn't really cost you anything and there would be no excess burden or utility losses associated with the tax. Construct an indifference curve budget-line diagram that clearly illustrates your answer.
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