Princeton Review
A state legislator drafts an income tax proposal that imposes a tax of 20% on the first $100,000 of an individual’s income, increases the tax to 25% on the next $50,000 in income, and increases the tax by an additional 5% on each additional $50,000 in income, to a maximum tax of 40% on the portion of income over $250,000. Under the proposal, would the state collect an average (arithmetic mean) of more than 30% of the income of the residents of County X ?
1) The median income for a resident of County X is $65,000
2) No resident of County X earns an income of more than $350,000
OA B