3. A worker within the middle income class is preparing to retire. In the year before he retired, his gross monthly earnings are $2,000. His Social Security benefits will be $1,200 per month. Before he retired, his income was subject to a tax of 25 percent. Find his before-tax and after-tax replacement rates

The replacement rate is the percentage of the final income that the pension compensates.

Before-tax replacement rate:

The worker made $2,000, and his social security benefits are $1,200.

1,200 x 100% / 2,000 = 60%

The before-tax replacement rate is 60%.

After-tax replacement rate:

His 2,000 income was subject to a 25% tax.

2,000 x 25% = 500

His after-tax income was 1,500

1,200 x 100% / 1,500 = 80%

The after-tax replacement rate is 80%.

explanation: doctrine of respondeat superior is a legal doctrine that is commonly used in tort. this principle makes an employer or principal legally responsible for the wrongful acts done by an employee or agent, if such acts occur within the scope of the employment or agency.