Suppose the tax rate on the first $20,000 income is 0 percent; 10 percent on the next $20,000 earned; and 20 percent on any additional income earned. The marginal tax rate for a person earning $30,000 is

Question

Quizplus · Accepted Answer

The marginal tax rate is the rate applied to the last dollar earned. For someone earning $30,000, the last $10,000 falls into the 10 percent bracket.

Suppose the Tax Rate on the First $20,000 Income Is