Grades 9-12
Wells Fargo Presents Personal Finance for Educators, Pt. 1: Budgeting and Debt Management
Presenter: Doug Young
Don't have an account yet? Sign up for free
Don't have an account yet? Sign up for free
Students take a quiz that involves earning income and paying a tax. Through this activity, they generate data that they use to create a table, a graph, and to build equations that represent relationships between quantities. Students scale and label axes as they create graphs of relationships between income and tax. Tables and graphs of data are then used by the students to construct equations representing examples of relationships between income, tax, and average tax ratio. Students explore the graphs to draw conclusions about the impact of different tax structures on families with different incomes. Note: students should have prior knowledge of graphing linear functions for this lesson.
60 minutes
PREPARATION: students can take the quiz (Activity 1) the day before the lesson is taught or as warm up for the lesson
Multiple Choice
Constructed Response
[Possible student answers: the proportional tax is fair because it taxes everyone at a constant ratio: the tax is fair because it takes a smaller amount from people with less income: the proportional tax is not fair because the amount paid by a lower income household leaves less disposable income than a higher income household: the tax is not fair because lower income households have to give up more necessities than higher income households.]
Taxation is the process in which a charge is imposed upon a taxpayer by government. Taxes are compulsory payments to governments by households and businesses. Tax structures impact households with different incomes differently. Representations of tax structures serve as a context for creating tables, graphs, and equations. An equation is a mathematical sentence that contains an equal sign. Equations use constants and variables to represent relationships between quantities. Variables are symbols used to represent numbers. We can analyze the impact of tax structure on households with different incomes by creating tables, graphs and equations. In the case of taxes, the average tax ratio can be represented as slopes of line segments between the origin and points of interest on graphs, representing relationships between income and tax.
T = 0, when 0 ≤ I ≤ 10
T= .2(I-10)
Tell students that the equations represent a piecewise function, a special function used when one equation cannot represent all of the data provided.
[Students' tables should be filled in as follows.]
Total Earnings Before Taxes |
Total Taxes Paid |
Average tax ratio |
$5 |
$0 |
0 |
$10 |
$0 |
0 |
$15 |
$1 |
0.066 |
$20 |
$2 |
0.10 |
$25 |
$3 |
0.12 |
$30 |
$4 |
0.133 |
$35 |
$5 |
0.143 |
Grades 9-12
Presenter: Doug Young
Grades 9-12
Grades 9-12
Grades 9-12