Reference no: EM131980044

A hypothetical society has three income earners, and all three must pay income taxes. The taxable income of Andrew is $40,000, the taxable income of Julia is $100,000, and the taxable income of John is $200,000. A) How much tax revenue will be raised under a proportional income tax when the tax rate is 10%? How much tax revenue will be raised under a proportional income tax when the tax rate is 15%? B) A progressive tax system is installed with a rate of 5% on income $1,000-$40,000, a rate of 8% on income from $40,001-$100,000, and a rate of 15% on all income over $100,000. Will this system raise more or less tax revenue than a proportional tax rate of 10%. Explain your answer.