Ask Question
BusinessBusiness
4 July, 09:54

Suppose the amount the federal government collects in personal income taxes increases, while the level of GDP remains the same. What will happen to the values of national income, personal income, and disposable personal income? National income will ___.

Personal income will ___.

Disposable personal income will ___.

+1
Answers (1)
  1. 4 July, 10:25
    0
    National income will remain the same.

    Personal income will remain the same.

    Disposable personal income will decrease.

    Explanation:

    We know, National income (NI) = Net national product (NNP) - Indirect business taxes.

    NNP = Gross national product (GNP) - Consumption of fixed capital (depreciation)

    Personal income (PI) = National income (NI) - Corporate earnings + Government transfer payments.

    Disposable personal income = Personal income (PI) - Personal taxes

    Disposable personal income is the income or the amount of money that household have for daily spending and savings after paying income tax to the government. If personal income tax increases, it decreases the disposable personal income.

    National income and personal income does not get affected by the increase in personal income taxes as given in the formula above.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Suppose the amount the federal government collects in personal income taxes increases, while the level of GDP remains the same. What will ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
The adjusted trial balance for Yondel Company at December 31, 2018 is presented below: Accounts Debit Credit Cash $ 8,000 Prepaid rent 23,000 Land 445,000 Accounts payable $ 12,000 Salaries payable 20,000 Common stock 230,000 Retained earnings
Answers (1)
Ambrose enters into a contract to buy 350 acres from belle vista farms to cultivate grapes and open a winery. if ambrose breaches the contract, belle vista's remedy would most likely be
Answers (1)
Daniel, a manager at Joe's Fish Shack, monitors the performance of workers in his department to check if the quality of their work is meeting the performance standards of the company. In doing so, which managerial task is Daniel performing?
Answers (1)
What is one reasons why mixed economies exist? Question 7 options: Communism allowed free purchasing of all goods. Capitalism had too many limits. Mixed economics place some limits for the safety of society. Adam Smith felt this was the best model.
Answers (2)
U. S. Products operates two divisions with the following sales and expense information for the month of May: North Division: Sales $240,000; Operating income $72,000, Operating assets $600,000.
Answers (1)
New Questions in Business
Suppose that B2B, Inc., has a capital structure of 35 percent equity, 16 percent preferred stock, and 49 percent debt. Assume the before-tax component costs of equity, preferred stock, and debt are 14.5 percent, 11.0 percent, and 9.
Answers (1)
C. explain the court's guidelines for deciding discrimination cases.
Answers (1)
Changing workplace procedures tends to be counterproductive
Answers (1)
Consumption expenditures: a. Account for over two-thirds of total spending. b. Include purchases of new and used goods by consumers. c. Are equal to disposable personal income plus personal savings. d.
Answers (1)
Mary, a CPA, prepared Gordon's tax return for the current year. In preparing his return, she took a deduction that is contrary to the Code.
Answers (1)
Home » Business » Suppose the amount the federal government collects in personal income taxes increases, while the level of GDP remains the same.
Sign Up Forgot Password?