Asked by
Tiffany Rodgers
on Oct 13, 2024
Verified
When taxable income rises from $40,000 to $50,000,
A) your average tax rate is greater than your marginal tax rate.
B) your marginal tax rate is greater than your average tax rate.
C) your marginal and average tax rates are equal.
D) it is impossible to determine if your average or marginal tax rate is higher.
Average Tax Rate
The proportion of total income that is paid in taxes, calculated by dividing the total amount of taxes paid by total income.
Marginal Tax Rate
The rate at which your last dollar of income is taxed, indicating the tax rate applied to the next dollar of taxable income.
- Determine the amount of taxable income, taxes remitted, as well as average and marginal tax rates using the provided information.
Verified Answer
SJ
Learning Objectives
- Determine the amount of taxable income, taxes remitted, as well as average and marginal tax rates using the provided information.