Frank Morgan's Math Chat - Our Favorite Tax

March 1, 2001

Old Challenge. What kind of tax is best for the economy?

Answer. In a certain theoretical ideal, the best tax for the economy would be a fixed dollar amount per adult, since there would be no disincentive to initiative or consumption; but such a per capita tax would be impractical as well as unfair. Fairer would be a flat tax (fixed percentage) on consumption. Still fairer would be a flat tax on income.

Riddle (Alex Glasser). Is there something amiss in the opening of O. Henry's famous Christmas story, "The Gift of the Magi":

"One dollar and eighty-seven cents. That was all. And sixty cents of it was in pennies...Three times Della counted it. One dollar and eighty-seven cents. And the next day would be Christmas."

New Challenge (Al Zimmermann). In Russian Roulette, five of the six chambers of a water gun are empty, and the sixth is loaded with whipped cream. Two players take turns spinning the chambers of a gun and firing at themselves, hoping to stay clean. The second player has a decided advantage. How can the game be modified so that each player has an equal chance of winning?

Send answers, comments, and new questions by email to Frank.Morgan@williams.edu, to be eligible for Flatland and other book awards. Winning answers will appear in the next Math Chat. Math Chat appears on the first and third Thursdays of each month. Prof. Morgan's homepage is at www.williams.edu/Mathematics/fmorgan.

THE MATH CHAT BOOK, including a \$1000 Math Chat Book QUEST, questions and answers, and a list of past challenge winners, is now available from the MAA (800-331-1622).