Question

Suppose that tax paid by a certain person per year is denoted Ti, and is calculated using the following rela- tionship to that persons gross income (Gi): Ti=0.25(Gi-10000) (i.e, only people who have an income over $10,000 per year are taxed, and only the income beyond S10,000) You are told that the total gross income for an area with 200 people is $6,000,000. Assume that all the people measured make over $10,000 a year Find the total taxes collected for the 200 people.

Answer 1

To find the total taxes collected for the 200 people, subtract $10,000 from each person's gross income, multiply the result by 0.25 to get the tax paid by each person, and then add up the tax paid by all the people.

Step-by-step explanation:

To find the total taxes collected for the 200 people, we need to calculate the tax paid by each person and then add them up. The tax paid by each person per year is calculated using the formula Ti = 0.25(Gi - 10000), where Ti is the tax paid and Gi is the gross income. Since all the people in the area make over $10,000 a year, we can use the total gross income for the 200 people, which is $6,000,000.

First, subtract $10,000 from each person's gross income. Then, multiply the result by 0.25 to get the tax paid by each person. Finally, add up the tax paid by all the people to find the total taxes collected.

Let's do the calculations:

1. Subtract $10,000 from $6,000,000 to get $5,990,000.
2. Multiply $5,990,000 by 0.25 to get $1,497,500.

Therefore, the total taxes collected for the 200 people is $1,497,500.

Answer 2

The total taxes collected for the 200 people is approximately $1,000,000.

Step-by-step explanation:

Calculate the average gross income:

Total gross income / Number of people = $6,000,000 / 200 = $30,000

Calculate the taxable income for each person:

Taxable income = Average gross income - $10,000 = $30,000 - $10,000 = $20,000

Calculate the total tax per person:

Tax per person = Tax rate * Taxable income = 0.25 * $20,000 = $5,000

Calculate the total taxes collected:

Total taxes = Number of people * Tax per person = 200 * $5,000 = $1,000,000

Therefore, the total taxes collected from the 200 people in the area is approximately $1,000,000.