Bar Stool Economics Discussion I have updated my all documents about this discussion. Please follow my requirements to finish this assignment. Appreciate!

Bar Stool Economics Discussion I have updated my all documents about this discussion. Please follow my requirements to finish this assignment. Appreciate! This assignment requires you to read and discuss the article “Bar
Stool Economics” How_tax_cuts_work.doc
). I expect you to
discuss your thoughts, agreements, disagreements, questions, etc.
for this and the remaining assignments. I am not looking for a
specific length, rather an intelligent discussion of the material.
The only requirement is for you to post as described above, you are
not required to respond to anyone’s post. However, the idea is to
discuss these topics as a group.
Bar Stool Economics
Suppose that every day, ten men go out for beer and the bill for all ten comes to
$100. If they paid their bill the way we pay our taxes, it would go something like
this:
The
The
The
The
The
The
The
first four men (the poorest) would pay nothing.
fifth would pay $1.
sixth would pay $3.
seventh would pay $7.
eighth would pay $12.
ninth would pay $18.
tenth man (the richest) would pay $59.
So, that’s what they decided to do. The ten men drank in the bar every day and
seemed quite happy with the arrangement, until on e day, the owner threw them a
curve. ‘Since you are all such good customers, he said, ‘I’m going to reduce the
cost of your daily beer by $20. Drinks for the ten now cost just $80.
The group still wanted to pay their bill the way we pay our taxes so the first four men
were unaffected. They would still drink for free. But what about the other six menthe paying customers? How could they divide the $20 windfall so that everyone would
get his ‘fair share?’ They realized that $20 divided by six is $3.33. But if they
subtracted that from everybody’s share, then the fifth man and the sixth man would
each end up being paid to drink his beer. So, the bar owner suggested that it would be
fair to reduce each man’s bill by roughly the same amount, and he proceeded to work
out the amounts each should pay.
And so:
The
The
The
The
The
The
fifth man, like the first four, now paid nothing (100% savings).
sixth now paid $2 instead of $3 (33%savings).
seventh now pay $5 instead of $7 (28%savings).
eighth now paid $9 instead of $12 (25% savings).
ninth now paid $14 instead of $18 (22% savings).
tenth now paid $49 instead of $59 (16% savings).
Each of the six was better off than before. And the first four continued to drink for
free. But once outside the restaurant, the men began to compare their savings.
‘I only got a dollar out of the $20,’declared the sixth man. He pointed to the tenth
man,’ but he got $10!’
‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only saved a dollar, too. It’s unfair
that he got ten times more than I!’
‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got
only two? The wealthy get all the breaks!’
‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get anything at all.
The system exploits the poor!’
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn’t show up for drinks, so the nine sat down and had
beers without him. But when it came time to pay the bill, they discovered something
important. They didn’t have enough money between all of them for even half of the
bill!
And that, boys and girls, journalists and college professors, is how our tax system
works. The people who pay the highest taxes get the most benefit from a tax
reduction. Tax them too much, attack them for being wealthy, and they just may not
show up anymore. In fact, they might start drinking overseas where the atmosphere is
somewhat friendlier.
David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia
For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible

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