Asked by
Chase Chumbley
on Nov 26, 2024
Verified
The tax rates embodied in the federal personal income tax are such that
A) a rising absolute amount, but a declining proportion, of income is paid in taxes.
B) the marginal and average tax rates are equal, making the tax progressive.
C) the average tax rate rises more rapidly than does the marginal tax rate as income rises.
D) the marginal tax rate is higher than the average tax rate, causing the average tax rate to rise as income rises.
Marginal Tax Rate
The rate at which the last dollar of income is taxed, reflecting the percentage of tax paid on any additional dollar earned.
Average Tax Rate
The ratio of the total amount of taxes paid to the total income of the taxpayer, indicating the burden of taxation.
Federal Personal Income Tax
A tax levied by the federal government on individuals’ earnings, varying in rate based on income level.
- Gain insight into the essential aspects and definitions of progressive, regressive, and proportional taxation methods.
- Calculate and interpret marginal and average tax rates.
Verified Answer
BG
Learning Objectives
- Gain insight into the essential aspects and definitions of progressive, regressive, and proportional taxation methods.
- Calculate and interpret marginal and average tax rates.