ECON 214 Problem Set 8 solutions complete answers

ECON 214 Problem Set 8 solutions complete answers 

 

Just put your values given and automatically provide answers for you!

 

The Flannigan household’s annual income is $374000. Based on the U.S. federal tax rates below, what is the average tax rate for the Flannigan household? (Assume zero tax deductions for solving this problem.)

 

The Gonzalez household’s annual income is $300000. Based on the U.S. federal tax rates shown in the table, what is the total income tax that the Gonzalez household has to pay on its household income? (Assume zero tax deductions.)

 

The government announced that last year it spent $179 million in mandatory outlays and $416 million in discretionary outlays. It received $612 million in revenue.

 

In the country of Econoville, tax revenue collected by the government this year is $15 million, and government outlays are $12 million. This country currently has a

 

Question 1

 

Please read the article that can be accessed below and use the information in the article to answer this question.

 

Brazil’s Exploding Debt-to-GDP Is Going to Become a Problem Soon by Jonathan Levin & Ye Xie

 

According to the article, Desmond Lachman, a former International Monetary Fund director, believes that Brazil is on course to have its percentage of gross debt-to-GDP become greater than        percent  in 2 years.

 

Suppose that gross debt-to-GDP ratios at or above this percentage will reduce the economic growth rate of any country. With this in mind, find the debt-to-GDP ratios for several countries in the graph below, titled “International Debt-to-GDP Ratios, 2013.” Using the information in the graph, identify which of the following countries have a debt-to-GDP ratio that is high enough to hamper their economic growth. Move these countries to the box labeled “Hampered Growth.” Move the other countries to the box labeled “Growth Unaffected.”

 

Question 2

 

Using the marginal income tax rates shown below, what is the average tax rate on incomes of $100,000 and $200,000? Give all answers to two decimals.

 

a. Average tax rate on $100,000 of income:

 

b. Average tax rate on $200,000 of income: 

 

Question 3

 

(All the data in the table above are from the Organization for Economic Cooperation and Development and are in billions of current U.S. dollars.)

 

Based on the table above, which of the four nations was in the worst fiscal shape in 2010?

 

Question 4

 

The establishment of Medicare in the 1960s has caused government outlays to        over time. The Great Recession caused a further        in government outlays.

 

Question 5

 

Based on the data shown in the table above, the average annual increase in the Greek debt over the 10-year span was $        billion. Give your answer to two decimals.

 

Question 6

 

Social Security and Medicare are programs that are requiring an ever-increasing share of the federal budget. There are a number of demographic reasons why this statement is true.

 

Which of the following statements are true?

 

Question 7

 

You have been hired as an economic advisor for a politician running for national office. At a recent campaign event, the politician said that corporations are paying too much in taxes and are funding most of the federal government’s operations. When you speak to the politician after the event, what would you say?

 

Question 8

 

Suppose that marginal income tax rates are as follows:

 

Also suppose that the taxes for Social Security and Medicare together are 7.65%, and that they are applied to income up to $100,000.

 

If your income is $123,000, what is your total income tax bill and how much will you have paid in Social Security and Medicare taxes?

 

Question 9

 

In the country of Econoville, tax revenue collected by the government this year is $10 million, and government outlays are $13 million. This country currently has a

 

Question 10

 

You hear a politician say that she would like to lower the retirement age for receiving Social Security. What would be the impact of such a change over the course of one year? 

 

Question 11

 

The mayor of your hometown has said she will request that the federal government extend a nearby interstate highway so that it passes by the city, stimulating economic growth. However, the federal government is reluctant to do this because it is currently running a budget deficit.

 

If the interstate was extended at a cost of $35 million, what would be the impact of this outlay on the federal government’s budget?  

 

Question 12

 

Part 1

 

You have a job at a real-estate agency in the small country of Cocovania, where you are paid 72,000 conchs (the currency of Cocovania) a year. You are now faced with the decision of whether to work a second job at the local university teaching a real-estate investing class, where the pay is 45,000 conchs a year. Social insurance tax and income tax rates are listed below.

 

Social insurance taxes: 7.65% on your first 110,100 conchs of total income

 

Using the information above, what would be the total amount you pay in social insurance taxes on your second job? Give your answer to two decimals.

 

Part 2

 

What is your income tax bill for the second job? Give your answer to two decimals.

 

Part 3

 

What is your total tax bill for the new job? Give your answer to two decimals.

 

Question 13

 

The government announced that last year it spent $589 million in mandatory outlays and $416 million in discretionary outlays. It received $1015 million in revenue.

 

Last year, the government had a budget        of $        million.

 

Question 14

 

The Gonzalez household’s annual income is $350000. Based on the U.S. federal tax rates shown in the table, what is the total income tax that the Gonzalez household has to pay on its household income? (Assume zero tax deductions.)

 

Question 15

 

The Flannigan household’s annual income is $188000. Based on the U.S. federal tax rates below, what is the average tax rate for the Flannigan household? (Assume zero tax deductions for solving this problem.)