Exhibit 16-3 Income for two persons $$\begin{array} { | l | r | }
\hline \text { Name } & \text { Income } \
\hline \text { Meredith } & \$ 124,000 \
\text { Hillary } & \$ 45,000 \
\hline
\end{array}$$ In Exhibit 16-3, if the income tax system is currently proportional, we know that:

Question

Exhibit 16-3 Income for two persons $$\begin{array} { | l | r | } 
\hline \text { Name } & \text { Income } \
\hline \text { Meredith } & \$ 124,000 \
\text { Hillary } & \$ 45,000 \
\hline
\end{array}$$ In Exhibit 16-3, if the income tax system is currently proportional, we know that:

Quizplus · Accepted Answer

In a proportional tax system, everyone pays the same percentage of their income in taxes. A progressive tax system taxes higher incomes at higher rates, which would likely be preferred by Hillary, who has a lower income. Meredith, with a higher income, would likely prefer a regressive tax system, where the tax rate decreases as income increases, as it would result in her paying a lower percentage of her income in taxes compared to a progressive system.

Exhibit 16-3 Income for Two Persons In Exhibit 16-3, If the Income Tax System Is Currently