Scenario 12-3

Scenario 12-3.A taxpayer faces the following tax rates on her income:
20 percent of the first $40,000 of her income;
30 percent of all her income above $40,000.
-Refer to Scenario 12-3.The taxpayer faces

A) a marginal tax rate of 20 percent when her income rises from $40,000 to $40,001.
B) a marginal tax rate of 20 percent when her income rises from $30,000 to $30,001.
C) a marginal tax rate of 0 percent when her income rises from $30,000 to $30,001.
D) a marginal tax rate of 10 percent when her income rises from $40,000 to $40,001.