Amy paid a tax of $0.33 on the last dollar she earned in 2007. Amy's marginal tax rate in 2007 was:

Question

Quizplus · Accepted Answer

Amy paid a tax of $0.33 on the last dollar she earned, which means her marginal tax rate is exactly 33%. The marginal tax rate is the tax rate applied to an additional dollar of income. Therefore, it is not related to her average tax rate, which is the total tax paid divided by the total income earned. It is also not necessarily higher or lower than the average tax rate.

Amy Paid a Tax of $0