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Raising the tax rate on labor income

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The government is considering raising the tax rate on labor income and asks you to report on the supply-side effects of such an action. Use appropriate graph and report directions of change, not exact magnitudes. What will happen to

-The supply of labor and why?

-The demand of labor and why?

-Equilibrium employment and why?

-The equilibrium before-tax wage rate and why?

-The equilibrium after-tax wage rate and why?

-Potential GDP?

Reference no: EM132550489

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