Which statement is correct with respect to marginal and average tax rates under a progressive tax...

90.2K

Verified Solution

Question

Accounting

Which statement is correct with respect to marginal and averagetax rates under a progressive tax structure?
Multiple Choice
Generalizations cannot be made. The question can only beanswered with reference to the tax situation of a specifictaxpayer.
At very low levels of taxable income, a taxpayer's marginal andaverage tax rates will be the same.
At very high levels of taxable income, a taxpayer's marginal andaverage tax rates will be the same.
For most taxpayers, the average tax rate is larger than themarginal tax rate.
.
.
Jordan and Paul, a married couple, have taxable income of$46,625, which is taxed as follows:
$18,650 × 10% = $ 1,865.00
($46,625 - $18,650) × 15% = 4,196.25
Total tax liability $ 6,061.25

Their marginal tax rate is:
Multiple Choice
13%.
10%.
15%.
12.5%.
.
.
Which of the following trial courts hear tax cases?
Multiple Choice
U.S. Tax Court.
All of these.
U.S. Court of Federal Claims.
U.S. District Court.

Answer & Explanation Solved by verified expert

3.6 Ratings (462 Votes)

Hey there Lets solve part by partdo refer the explanation given for your understanding Question 1 The correct option is B at very low levels of taxable income a taxpayers marginal and average tax rates will be the same The question is based on the Progressive tax system regime ie As taxable income increases the tax rate will also See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member


$18,650 × 10% =	$	1,865.00
($46,625 - $18,650) × 15% =		4,196.25
Total tax liability	$	6,061.25