You Have Decided to Live in a Converted Loft with Five

question 19

Multiple Choice

You have decided to live in a converted loft with five of your college friends. The loft is a large open room and as a group you have decided to divvy up the floor space using the Last-Diminisher Method. You label yourselves and the order in which the game is played has P₁ first, P₂ second, and so on. Here is how the method begins:

Round 1: P₁ makes the first cut; P₂ passes; P₃ passes; P₄ diminishes; P₅ diminishes; P₆ passes
Round 2: After the first claim is made, P₃ is the only diminisher.
Round 3: After the first claim is made, all the remaining players pass.
After the end of Round 3, which three players are still playing the game?

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Definitions:

Regressive Tax

A tax imposed in such a way that the tax rate decreases as the taxable amount increases, disproportionately affecting lower-income individuals.

Payroll Tax

Levies charged on employers or workers, typically based on a proportion of the wages that staff receive from their employers.

Labor Market

The labor market is an economic market in which workers seek employment and employers seek to hire workers, often influenced by factors like wages, demand, and qualifications.

Marginal Tax Rate

The rate at which the next dollar of taxable income is taxed, reflecting the incremental increase in tax paid on an additional dollar of income.