Your boss has decided to give you a raise, but this raise will send you into a higher income tax bracket. You can choose to accept or decline the raise.
Explain why accepting the raise is your best course of action. Discuss what this means with a marginal tax rate system.
Now take that slightly further into a discussion of marginal rates of substitution and transformation. What is it about marginal analysis that is so important to economics? Please discuss marginal wage setting, tax brackets, and opportunity cost.
Minimum word count: 400 words
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