It is likely that people will work less when the marginal tax rate is
A)91 percent.
B)30 percent.
C)26 percent.

Question

Quizplus · Accepted Answer

When the marginal tax rate is very high, such as 91 percent, people have less incentive to work because such a large portion of their earnings will be taxed. Therefore, they may choose to work less or find ways to reduce their taxable income to avoid being subjected to such high tax rates. When the marginal tax rate is lower, like 26 or 30 percent, the incentive to work and earn more may still be present.

It Is Likely That People Will Work Less When the Marginal