Question

suppose that a new federal tax relief act allows you to pay a 17% income tax rate instead of 32%. If your taxable inxome at the end of the year is $96,000, how much have you saved in tax dollars because of the new tax relief act?

Answer 1

This will require solving two equations
96,000×.17= 16,320
96,000×.32= 30,720
This represents the total tax paid at both of the tax rates.
30,720- 16,320= 14,400
This represents the difference between the two tax rates at 96k income. This is the total savings between the tax rates.