Exhibit 9-1
A flat tax plan allows individuals to deduct a standard allowance of $25,000 from their wages. Assume that the flat tax rate is 12%.
-Refer to Exhibit 9-1. How much income tax would you have to pay if you were earning $50,000 a year?

Question

​Exhibit 9-1
A flat tax plan allows individuals to deduct a standard allowance of $25,000 from their wages. Assume that the flat tax rate is 12%.
-Refer to Exhibit 9-1. How much income tax would you have to pay if you were earning $50,000 a year?

Quizplus · Accepted Answer

To calculate the income tax for someone earning $50,000 a year under the given flat tax plan:
- First, deduct the standard allowance of $25,000 from their wages: $50,000 - $25,000 = $25,000
- Multiply the remaining income by the flat tax rate of 12%: $25,000 x 0.12 = $3,000

Therefore, the correct answer is C) $3,000.

​Exhibit 9-1 A Flat Tax Plan Allows Individuals to Deduct a Standard

Exhibit 9-1 A Flat Tax Plan Allows Individuals to Deduct a Standard