In a given year, jennifer earns $50,000 and spends $40,000. during the same period, stcve earns $30,000 and spends $27,000. if jennifer and steve both must pay a 10 percent sales tax on goods purchased, the sales tax is

(a) a higher perccntage of income for jennifer than for steve
(b) a higher percentage of spending for steve

The sales tax is regressive with respect to income

Explanation:

sales tax by Jennifer = 0.1*30000

                                   = 3000

tax/income = 3000/50000

                   = 6%

sales tax by steve = 0.1*27000

                                   = 2700

tax/income = 2700/30000

                   = 9%

The tax increases with decrease in income, it indeed is regressive on the whole.

Therefore, The sales tax is regressive with respect to income

drop shippers;

d. all of the above are true.