Suppose That a Four-Person Family Can Earn Up to $15,120

question 19

Multiple Choice

Suppose that a four-person family can earn up to $15,120 and pay no income tax, and that income in the lowest tax bracket is taxed at 15 percent. Given the fact that the earned income tax credit falls by 21 cents for every additional dollar of gross income earned above $11,000, what is the marginal tax rate for a family of four if its gross income is $20,000?

• A)7 percent
• B)-7 percent
• C)15 percent
• D)21 percent
• E)36 percent

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Definitions:

Realistic Conflict Theory

Theory stating that prejudice and discrimination will be increased between groups that are in conflict over a limited resource.

In-Group

A social group to which an individual feels they belong, often characterized by a sense of identity and loyalty.

Out-Group

A social group with which an individual does not identify and may feel competition or hostility towards.

Social Psychology

The scientific study of how a person’s thoughts, feelings, and behavior influence and are influenced by social groups; area of psychology in which psychologists focus on how human behavior is affected by the presence of other people.