Graphically explain how tax act as a disincentive to workers efforts.

Answer 1

The following graph illustrates how taxes act as a disincentive to workers' efforts. The graph shows the relationship between the amount of effort a worker puts in and the amount of money they receive in return.

As the worker puts in more effort, the amount of money they receive in return increases. However, as the worker puts in more effort, the amount of money they receive in return decreases due to taxes. This creates a disincentive for the worker to put in more effort, as they will not receive the full benefit of their efforts.