Discuss the below in detail:
Q: In order to raise revenues during the recent recession, the governor of your state proposed the following taxation
formula: T (i)= 0.001i^0.5, where is represents the total annual income earned by an individual in dollars and T (i) is the income tax rate as a percentage of total annual income.
a. Calculate the after-tax (net) income N (i) an individual can expect to earn as a function of income (i)
b. Calculate an individual's marginal after-tax income at income levels of $100,000 and $500,000.
c. At what income does an individual's marginal after-tax income become negative? What is the after-tax income at that level, and what happens at higher income levels?
d. What do we suspect is the most anyone can earn after taxes?