Ms. Mahmood is a retired schoolteacher whose pension income is $25,000 per year. She also receives Canadian Pension Plan income of $5,000 per year. Mr. Little is a young man who does not choose to work. He inherited $600,000 from his Aunt Clara, which he invested in a bond fund that provides a 5 percent return, generating $30,000 income per year. If we are concerned about the equity of taxation, should we consider these two people as equals and tax them equally? Explain why or why not.

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The Answer of Ms. Mahmood is a retired schoolteacher whose pension income is $25,000 per year. She also receives Canadian Pension Plan income of $5,000 per year. Mr. Little is a young man who does not choose to work. He inherited $600,000 from his Aunt Clara, which he invested in a bond fund that provides a 5 percent return, generating $30,000 income per year. If we are concerned about the equity of taxation, should we consider these two people as equals and tax them equally? Explain why or why not.

Ms Mahmood Is a Retired Schoolteacher Whose Pension Income Is