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What do the results on optimal taxation imply about the desirability of taxing interest income?
Explain why it might be desirable to have a regressive tax structure, even if social welfare function is utilitarian, when general equilibrium effects of taxes.
What would that imply for the design of tax structures? Discuss the reasonableness of alternative assumptions.
Under what circumstances will an increase in the progressivity of the tax schedule increase the degree of before-tax inequality?
To what extent do you think that differences in views concerning how progressive our tax structure should be reflect differences in values, and u.
One argument sometimes made in favor of the use of commodity taxation rather than income. If it is, what do you think it implies about the design of tax policy?
What is the true economic depreciation? What is the present discounted value of this, assuming a 5 percent after-tax interest rate?
Discuss the equity and efficiency consequences of changing the rules so that only amounts in excess of $2000 per year are afforded special tax treatment.
What happens to point g> Draw the new consumption possibilities locus, and explain what happens to the portfolio allocation.
Analyze what happens if a tax is imposed on the returns to capital whether received by Americans or by foreigners.
Describe the distortions and inequity associated with an unindexed tax system in the presence of deflation.
Which affects Karl's consumption of beer more: a one dollar increase in PH or a one dollar increase in PB? Denote the price of hamburger by PHand of beer by PB.
Discuss the arguments for and against using a tax credit rather than a deduction for: medical expenses, charitable contributions, and child care expenses.
Which treatment do you think is appropriate? Under both the old and the new tax law, money received by lottery winners is taxable.
onsider a divorced individual who earns $26,000, has two children, pays $4800 in child care expenses. What is children's actual marginal tax rate?
Explain why federal tuition tax credits might lead states to increase the tuition they charge. What might one expect to happen in those states?
Discuss some of the controversies concerning who bears the burden of the corporation income tax.
Discuss the problems that arise when the corporation tax rate exceeds the highest personal income tax rates by a substantial amount
When the company pays executives directly, the wages are deductible from to the firm's income subject to the corporate income tax; the costs of stock?
Why might such a proposal be desirable? Would it completely resolve the problems that it is intended to address?
Under what circumstances might these two differ significantly? Are there any circumstance in which you be particularly concerned about what average tax rate is?
Compare the present discounted value of taxes an individual who is the sole owner of a corporation that has $1 million in profits would pay under the scenarios.
If the two were in the same tax bracket, what would be the consequences of these imputed interest payments and receipts? If they were in different tax brackets?
Can you think how you could use a straddle to postpone taxes? Prior to 1986, long-term capital gains were taxed much more lightly than short-term capital gains.
Describe the tax savings for someone in the 28 percent marginal tax bracket who owns a business with $10,000 in profits.