Question

1. In 2018, the Bank of Canada raised the overnight rate to 1.75%. Explain how rising interest rates in Canada would affect consumption. 2. Payroll taxes are 6.2%, and Medicare taxes are 2.9%. Your employer owes you $580. (a) Approximately how much will you receive after these deductions? (b) How much will your work cost your employer? 3. In your current job, you earn $92,000. You take the standard deduction of $12,200. You have an offer of a new job working for a different employer. Your salary would go up by $10,000. Social Security taxes are 6.2%, and Medicare taxes are 2.9%. Assuming no state and local taxes, when federal income taxes and payroll taxes are deducted, how much of the $10,000 do you get? For taxable ... but not ... the marginal income over... over... tax rate is: $0 $9,700 10% $9,700 $39,475 12% $39,475 $84,200 22% $84,200 $160,725 24% $160,725 $204,100 32% $204,100 $510,300 35% $510,300 37%

          1. In 2018, the Bank of Canada raised the overnight rate to 1.75%. Explain how rising interest rates in Canada
would affect consumption.
2. Payroll taxes are 6.2%, and Medicare taxes are 2.9%. Your employer owes you $580.
(a) Approximately how much will you receive after these deductions?
(b) How much will your work cost your employer?
3. In your current job, you earn $92,000. You take the standard deduction of $12,200. You have an offer of a
new job working for a different employer. Your salary would go up by $10,000. Social Security taxes are
6.2%, and Medicare taxes are 2.9%. Assuming no state and local taxes, when federal income taxes and payroll
taxes are deducted, how much of the $10,000 do you get?
For taxable
... but not
... the marginal
income over...
over...
tax rate is:
$0
$9,700
10%
$9,700
$39,475
12%
$39,475
$84,200
22%
$84,200
$160,725
24%
$160,725
$204,100
32%
$204,100
$510,300
35%
$510,300
37%

1. In 2018, the Bank of Canada raised the overnight rate to 1.75%. Explain how rising interest rates in Canada
would affect consumption.
2. Payroll taxes are 6.2%, and Medicare taxes are 2.9%. Your employer owes you $580.
(a) Approximately how much will you receive after these deductions?
(b) How much will your work cost your employer?
3. In your current job, you earn 92,000. You take the standard deduction of12,200. You have an offer of a
new job working for a different employer. Your salary would go up by 10,000. Social Security taxes are
6.2%, and Medicare taxes are 2.9%. Assuming no state and local taxes, when federal income taxes and payroll
taxes are deducted, how much of the10,000 do you get?
For taxable
... but not
... the marginal
income over...
over...
tax rate is:
09,700
10%
9,70039,475
12%
39,47584,200
22%
84,200160,725
24%
160,725204,100
32%
204,100510,300
35%
510,300
37%

Added by Emma L.

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