Suppose the government has been taxing each person's income at a marginal rate of 0.25 for every dollar in excess of $20,000. That is, the first $20,000 earned is not taxed. The government decides to generate extra revenue and wishes to avoid increasing the tax burden on low- or middle-income earners. Therefore, the government decides to impose a lump sum surtax of $1000 on every person who earns $60,000 or more.
a. Write and graph income after tax, y, as a function of income before tax, x.
So, as far as I understand this problem I am dealing here with a piecewise function. From 0 - $20,000 no tax, from $20,000 - $59,999 with 25% tax, and from $60,000 upwards with 25% tax plus a lump sum surtax of $1000.
However, I have no idea how can find the function to this problem in the end.
a. Write and graph income after tax, y, as a function of income before tax, x.
So, as far as I understand this problem I am dealing here with a piecewise function. From 0 - $20,000 no tax, from $20,000 - $59,999 with 25% tax, and from $60,000 upwards with 25% tax plus a lump sum surtax of $1000.
However, I have no idea how can find the function to this problem in the end.