For a progressive tax the

A) average tax rate exceeds the marginal tax rate as income rises.
B) marginal tax rate declines as income increases.
C) average and marginal tax rates are equal.
D) marginal tax rate exceeds the average tax rate as income rises.

Progressive Tax

A taxation system where the tax rate increases as the taxable amount rises, thereby imposing a higher percentage rate on those with higher incomes.

Marginal Tax Rate

The rate at which the last dollar of a person’s income is taxed, indicating the impact of an additional dollar of earnings on the amount of taxes paid.

Average Tax Rate

The proportion of total income that is paid in taxes.