What is the marginal tax rate for a corporation with $60,000 of taxable income and an average tax rate of 18% if the next lowest marginal tax rate of 15% covers taxable incomes up to $50,000?
Marginal Tax and Average Rate:
Marginal tax rate is the rate of tax at the next taxable dollar, while average tax rate is the rate of tax on the whole taxable amount. When a tax scheme is progressive (when the marginal tax increases with the taxable amount), average tax is never higher than marginal tax.
Answer and Explanation:
The answer is (C.) 33% is the marginal tax rate for a corporation with $60,000 of taxable income and an average tax rate of 18% if the next lowest...
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from Intro to Business: Help and ReviewChapter 24 / Lesson 8