
Which of the following statements about marginal tax rates is true?
A) A taxpayer's marginal rate can change with every transaction.
B) As the marginal rate increases, the tax cost of an income-generating transaction decreases.
C) As the marginal rate increases, the tax savings from a deduction increases.
D) Both a taxpayer's marginal rate can change with every transaction and, as the marginal rate increase, the tax savings from a deduction increases.
Correct Answer:
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