This Question: 1 pl 1 of 12 (0 complete) This Quiz: 12 pts The table shows the d

Question

This Question: 1 pl 1 of 12 (0 complete) This Quiz: 12 pts The table shows the dietribution of market income in an economy and Ihow the govermment redishributes income by collecting income taxes and paying benefts What is the income aher tax and benefits of the third 20 percent of households? The income after lax and benefts of the third 20 percent of households is S Market income Incorne Benefits mitionsax (miltions of of dollars)(percent) dollars) Households 10 Lowest 20 percent Second 20 percent7 Third 20 percent Fourth 20 percent 22 Fith 20 percent Aner to 1 decimal place 10 20 Enter your answer in the ansiver bos prt sc 5 6 9 0

Explanation / Answer

Market income of third 20 percent of households = $12 million

Income tax rate = 10% or 0.10

Income tax paid = $12 million * 0.10 = $1.2 million

Income after tax = $12 million - $1.2 million = $10.8 million

Benefits received = $8 million

Calculate the income after tax and benefits -

Income after tax and benefits = Income after tax + Benefits received = $10.8 million + $8 million = $18.8 million

The income after tax and benefits of the third 20 percent of households is $18.8 million.

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