Tax Revenue Equation Economics

In economics revenue will help know the sales of given quantity of goods and services.

Tax revenue equation economics. The money that a firm earns per period per day say from selling its product is called his total revenue tr per day. P 200 0 5q and p 0 5q. In empirical studies the value of y is the average of y series. Add each tax payment made during the legally defined tax collection period to arrive at total tax revenue.

Lgr y marginal tax revenue function total tax revenue function 100 dy dt y 1 dy dt. Revenue should be reported to the government periodically so that the government could know the total income of the country and collect the taxes. Assume that the tax on beer is 20 per unit a unit is a carton of drinks assume the demand and supply functions for cartons of beers per week are. Sales revenue 1 000 x 350 350 000.

A sample sales revenue calculation. The linear growth rate of tax revenue lgr y from the above equation will be estimated as follows. The formula for calculating total revenue can be written as. For a product based business the formula is revenue number of units sold x average price.

Tr p x q tr q. The total price gained by a given source is revenue. Calculate the amount of tax revenue collected by the government and the distribution of tax payments between buyers and. 1 y 100 b 1 y 100.

For instance in 2013 the state of new jersey collected a total of 8 235 billion in sales and use tax revenues which was approximately 30 5 percent of the 27 billion the state government collected from all taxes and fees for the same period. Last year we sold 1 000 game consoles for 350 per piece. For service based companies the formula is revenue number of customers x average price of services.