Problem

Personal tax rate Assume the total amount of state tax paid consists of an amount P for...

Personal tax rate Assume the total amount of state tax paid consists of an amount P for personal property and S percent of income I.

(a) Find a function that calculates an individual’s state tax rate R—that is, the percentage of the individual’s income that is paid in taxes. (It is helpful to consider specific values to create the function.)

(b) What happens to R as I gets very large?

(c) Discuss the statement “Rich people pay a lower percentage of their income in state taxes than any other group.”

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