Use the idea of interpersonal comparisons of utility to argue for a progressive income tax system where people in higher income brackets are charged higher tax rates on their extra income
Since the marginal utility of money diminishes for each individual, it seems reasonable to suppose that the utility a rich person derives from his/her marginal dollar is less than the utility a poor person derives from his/her marginal dollar. If the rich person doesn't get as much utility from his/her marginal dollar, then it won't hurt them as much to tax it away as it would hurt a poor person.
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The Fed purchases $1 million of U.S. government securities from First Bank. The desired reserve ratio is 10 percent, the currency drain ratio is zero, and banks loan all excess reserves
The Fed's purchase increases First Bank's excess reserves by how much? A) $900,000 B) $1,000,000 C) $1,100,000 D) $10,000,000 E) $100,000
An increase in unearned income always creates a disincentive to work
Indicate whether the statement is true or false