Refer to Figure 5-13. The amount of the gasoline tax is ________ per gallon

Refer to the scenario above. Which family pays the lowest percentage of its income as taxes if the government follows a progressive tax system?

A) The first household B) The second household C) The third household D) The fourth household

There are two players in a game. At each round of the game, one player has to trust the other for a particular task. In the first round, Player 1 has to decide whether he will trust Player 2

If he does not trust Player 2, he will get one-third of the prize money, while Player 2 will get the rest of the prize money. If he trusts Player 2, Player 2 can either cooperate with him or defect. If Player 2 defects, Player 1 will earn $0, while Player 2 will get the entire prize money. If Player 2 cooperates, each of them will get half the prize money. What will the equilibrium outcome of this game be if Player 1 can impose a guilt penalty of two-thirds of the prize money and is known to be a vengeful player?