Suppose a certain business pays 10% tax on its first $10,000 in come,12% tax on income above $10,000 but below $40,000,and 22% tax on income above $40,000.Suppose the business earns $50,000 in income this year.Its average tax rate is closest to ________.

Question

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The business pays 10% tax on the first $10,000, which is $1,000. It pays 12% tax on the next $30,000, which is $3,600. It pays 22% tax on the remaining $10,000, which is $2,200. The total tax paid is $6,800. The average tax rate is $6,800/$50,000 = 13.6%, which is closest to 14%.

Suppose a Certain Business Pays 10% Tax on Its First