Economics: Principles, Problems, and Policies, 19th Edition

Published by McGraw-Hill Education
ISBN 10: 0073511447
ISBN 13: 978-0-07351-144-3

Chapter 20 - Income Inequality, Poverty, and Discrimination - Problems - Page 432: 3d

Answer

${$200}$ Increase by ${$5}$/hour.

Work Step by Step

Again from part (b), the lawyer earns ${$4000}$/week, so when the government takes tax, it takes all of the lawyer's income at this tax rate. Divided among 20 workers, each worker will receive $\frac{$4000}{20}$ = ${$200}$, and on an hourly basis, it will increase by $\frac{$200}{40}$ = ${$5}$/hour.
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