If the government keeps the average tax rate fixed, while increasing the marginal tax rate, we will observe Select one: a. increase the amount of labor supplied at any real wage. b. not affect the amount of labor supplied at any real wage. c. decrease the amount of labor supplied at any real wage. d. increase the amount of labor supplied at any real wage if the average tax rate is above the marginal tax rate, but decrease the amount of labor supplied at any real wage if the average tax rate is below the marginal tax rate.

If the government keeps the average tax rate fixed, while increasing the marginal tax rate, we will observe Select one: a. increase the amount of labor supplied at any real wage. b. not affect the amount of labor supplied at any real wage. c. decrease the amount of labor supplied at any real wage. d. increase the amount of labor supplied at any real wage if the average tax rate is above the marginal tax rate, but decrease the amount of labor supplied at any real wage if the average tax rate is below the marginal tax rate.

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 4PA

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