The equation below forecasts personal income tax (PIT) using two explanatory variables, personal income (PI) in dollars
Posted: Wed Mar 30, 2022 3:43 pm
The equation below forecasts personal income tax (PIT) using two
explanatory variables, personal income (PI) in dollars and the
personal income tax rate (R) in percentage points (e.g. if the tax
rate is 4% then R=4). Which statement below is correct based
on this equation?
A) If personal income increases by $423, personal income tax
revenue would increase by $423.50, holding the tax rate
constant.
B) If personal income increases by $633, personal income tax
revenue would increase by $316.50, holding the tax rate
constant.
C) If the personal income tax rate increases by 3 percentage
points, personal income tax revenue increases by $5, holding the
personal income constant.
D) If the personal income tax rate increases by 3 percentage
points, personal income tax revenue increases by $500, holding
personal income constant.
E) All of the above.
F) None of the above.
PIT 300 + 0.5PI + 50R
explanatory variables, personal income (PI) in dollars and the
personal income tax rate (R) in percentage points (e.g. if the tax
rate is 4% then R=4). Which statement below is correct based
on this equation?
- The Equation Below Forecasts Personal Income Tax Pit Using Two Explanatory Variables Personal Income Pi In Dollars 1 (1.8 KiB) Viewed 46 times
revenue would increase by $423.50, holding the tax rate
constant.
B) If personal income increases by $633, personal income tax
revenue would increase by $316.50, holding the tax rate
constant.
C) If the personal income tax rate increases by 3 percentage
points, personal income tax revenue increases by $5, holding the
personal income constant.
D) If the personal income tax rate increases by 3 percentage
points, personal income tax revenue increases by $500, holding
personal income constant.
E) All of the above.
F) None of the above.
PIT 300 + 0.5PI + 50R