Which of the following is required to achieve progressivity for a particular tax?
A)a marginal tax rate equal to the average tax rate (implying that the average tax rate is rising with income)
B)a marginal tax rate equal to the average tax rate (implying that the average tax rate is falling with income)
C)an average tax rate above the marginal tax rate (implying that the average tax rate is falling with income)
D)a marginal tax rate above the average tax rate (implying that the average tax rate is rising with income)
E)a constant tax rate for all incomes

Question

Quizplus · Accepted Answer

In order to achieve progressivity, the marginal tax rate must be greater than the average tax rate, implying that the average tax rate is rising with income. This means that as a person's income increases, the percentage of their income that is paid in taxes also increases.

Which of the Following Is Required to Achieve Progressivity for a Particular