Repeat Exercise 14 for a family whose taxable income was $200,000.
Exercise
A 1996 presidential primary candidate proposed a “flat tax” under which a family of four would pay as its federal income tax each year an amount equal to 17% of the portion of its taxable income in excess of $36,000. Suppose that a family’s 1996 taxable income was $50.000
a. Under this proposal, how much would be owed as income tax?
b. Suppose that Ibis family's actual federal income tax bill for 1996 was $6015 plus 28% of the amount of their taxable income over $40,100. How much income tax did the family owe?
c. Under which method of assessing taxes would the family pay less tax?
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