GMAT Question of the Day - Daily to your Mailbox; hard ones only

 It is currently 21 Sep 2018, 03:01

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Show Tags

24 Oct 2017, 01:30
00:00

Difficulty:

(N/A)

Question Stats:

73% (00:42) correct 28% (01:34) wrong based on 39 sessions

HideShow timer Statistics

A person who has an income of $10,000 pays what percent (to the nearest percent) of his or her income in taxes? (A) 1 (B) 2 (C) 3 (D) 4 (E) 5 _________________ Senior Manager Joined: 05 Dec 2016 Posts: 252 Concentration: Strategy, Finance GMAT 1: 620 Q46 V29 Re: A person who has an income of$10,000 pays what percent (to the neares  [#permalink]

Show Tags

24 Oct 2017, 04:10
I'll try:
140+4% of 2000 (income above 8k)=140+80=220
220/10000=0,022=2,2%~2%

Intern
Joined: 09 Sep 2016
Posts: 1

Show Tags

25 Oct 2017, 08:13
Bunuel wrote:

A person who has an income of $10,000 pays what percent (to the nearest percent) of his or her income in taxes? (A) 1 (B) 2 (C) 3 (D) 4 (E) 5 Whichever tax bracket you choose for the$10,000, the amount she pays is $220. That amount is 2.2 percent of her income. Answer B She has to pay only once. (Otherwise, someone who makes$11,000 pays less than she. That defies the logic of the progressive tax bracket data.)

$10,000 happens to be the end and beginning of two brackets. It doesn't matter. Both brackets yield identical taxes owed. 1) Lower bracket (range) amount In the$8,000-10000 bracket, a person who earns $10,000 pays: a) a flat$140 plus
b) 4% of income over 8,000

(10,000-8,000) = $2,000 excess income ($2,000 * .04) = $80 excess tax Flat$140 tax + $80 excess tax = Total taxes paid:$220

2) Higher bracket tax amount

If (10,000 - 15,000), taxes paid:
a) a flat $220 plus b) 5 percent of income > 10,000 There is no income over 10,000. Total taxes paid:$220

$220 is what percent of her$10,000 income?

Percent of income:

$$(\frac{220}{10000} * 100)$$ = (.022 * 100) =

2.2 percent, round down to 2%

* Here, a "bracket" specifies a range of income. If you fall in that range, you pay whatever amount the bracket says. Usually a bracket such as this one would say: "8000-9999, [pay $140 plus. . ."] The next bracket would step up to "10000 - 12000, [pay$180 + . . ."] It doesn't matter here. The amounts are the same.

_________________

In the depths of winter, I finally learned
that within me there lay an invincible summer.

Status: Preparing for GMAT
Joined: 25 Nov 2015
Posts: 927
Location: India
GPA: 3.64

Show Tags

Updated on: 25 Oct 2017, 22:27
It's already mentioned in 5th row entry that the base tax for $10,000 is 220. So 220 is what percent of$10,000? 2.2
=> 2% to nearest percent.
_________________

------------------------------
"Trust the timing of your life"
Hit Kudus if this has helped you get closer to your goal, and also to assist others save time. Tq

Originally posted by TaN1213 on 25 Oct 2017, 09:49.
Last edited by TaN1213 on 25 Oct 2017, 22:27, edited 1 time in total.
Board of Directors
Status: QA & VA Forum Moderator
Joined: 11 Jun 2011
Posts: 4032
Location: India
GPA: 3.5
Re: A person who has an income of $10,000 pays what percent (to the neares [#permalink] Show Tags 25 Oct 2017, 11:36 Bunuel wrote: A person who has an income of$10,000 pays what percent (to the nearest percent) of his or her income in taxes?

(A) 1
(B) 2
(C) 3
(D) 4
(E) 5

For income up to 4000 = 40
For income 4000 - 6000 = 40 + 2% of 6000

So, Total Tax is = 40 + 40 + 1200

Thus, Tax will be 2000

Hence, Percentage of income Tax paid is 2% , answer will be (B)
_________________

Thanks and Regards

Abhishek....

PLEASE FOLLOW THE RULES FOR POSTING IN QA AND VA FORUM AND USE SEARCH FUNCTION BEFORE POSTING NEW QUESTIONS

How to use Search Function in GMAT Club | Rules for Posting in QA forum | Writing Mathematical Formulas |Rules for Posting in VA forum | Request Expert's Reply ( VA Forum Only )

Target Test Prep Representative
Affiliations: Target Test Prep
Joined: 04 Mar 2011
Posts: 2835
Re: A person who has an income of $10,000 pays what percent (to the neares [#permalink] Show Tags 26 Oct 2017, 15:47 Bunuel wrote: A person who has an income of$10,000 pays what percent (to the nearest percent) of his or her income in taxes?

(A) 1
(B) 2
(C) 3
(D) 4
(E) 5

For a person who earns $10,000, he or she pays 220 + 0.05(10,000 - 10,000) =$220. Thus, his or her actual tax rate is 220/10,000 = 0.022 = 2.2% ≈ 2%.

_________________

Jeffery Miller

GMAT Quant Self-Study Course
500+ lessons 3000+ practice problems 800+ HD solutions

Events & Promotions

 Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.