It is primarily the marginal tax rate that affects investment decision making.

Question

Quizplus · Accepted Answer

The marginal tax rate is the tax rate applied to an additional dollar earned. As such, it affects the net return on investment and can influence decision making. A higher marginal tax rate means investors may be less likely to pursue certain investments or may seek tax-efficient strategies. Other factors, such as interest rates, regulation, and economic conditions, can also impact investment decisions. However, the marginal tax rate is one important consideration for investors.

It Is Primarily the Marginal Tax Rate That Affects Investment