In a progressive tax system,if a person moves from one income bracket to a higher income bracket:
A) both the marginal tax rate and average tax rate will be higher.
B) both the marginal tax rate and average tax rate will be lower.
C) the marginal tax rate will be lower and the average tax rate will be higher.
D) the marginal tax rate will be higher and the average tax rate will be lower.

Question

Quizplus · Accepted Answer

In a progressive tax system, as a person moves to a higher income bracket, both the marginal tax rate (the tax rate on the next dollar of income) and the average tax rate (total tax paid divided by total income) increase. This is because higher income is taxed at higher rates.

In a Progressive Tax System,if a Person Moves from One