Let's break down the problem step by step:
### Step 1: Understand the Tax System Described
In the given scenario, Tony, Juan, and Isabel each purchased the same computer costing [tex]$\$[/tex]2,000[tex]$ and paid $[/tex]\[tex]$160$[/tex] in sales tax. The sales tax rate is [tex]$8\%$[/tex]. Here’s how the tax rate is calculated for each of them:
- Tony: [tex]\[
\text{Sales Tax Rate} = \frac{\$160}{\$10,000} = 1.6\%
\][/tex]
- Juan: [tex]\[
\text{Sales Tax Rate} = \frac{\$160}{\$50,000} = 0.32\%
\][/tex]
- Isabel: [tex]\[
\text{Sales Tax Rate} = \frac{\$160}{\$75,000} = 0.21\%
\][/tex]
The scenario clearly depicts a regressive tax system where the lower-income person (Tony) pays a higher percentage of his income compared to Juan and Isabel.
### Step 2: Determine who pays the same amount of sales tax
Isabel, Tony, and Juan all pay the same amount of sales tax, which is \[tex]$160.
### Step 3: Identify who pays the highest tax rate on the computer
From the table:
- Tony pays $[/tex]1.6\%[tex]$ of his income.
- Juan pays $[/tex]0.32\%[tex]$ of his income.
- Isabel pays $[/tex]0.21\%$ of her income.
Thus, Tony pays the highest tax rate on the computer.
### Step 4: Identify who would be most affected by an increase in the sales tax rate
Typically, the person with the lowest income is most affected by an increase in the sales tax rate because a larger proportion of their income goes to taxes. In this scenario, that person is Tony.
### Final Filling of the Gaps
- This scenario describes a regressive tax system.
- Isabel pays the same amount of sales tax as Tony and Juan on the computer.
- Tony pays the highest tax rate on the computer.
- Tony would be most affected by an increase in the sales tax rate.
Putting it all together, we have:
```markdown
This scenario describes a regressive tax system. Isabel pays the same amount of sales tax as Tony and Juan on the computer. Tony pays the highest tax rate on the computer. Tony would be the most affected by an increase in the sales tax rate.
```
