Your _____ tax rate is the amount of tax payable on the next taxable dollar you earn.

Question

Quizplus · Accepted Answer

Marginal tax rate refers to the tax rate on the last dollar earned, so it is the most relevant tax rate for individuals to consider when making decisions about increasing or decreasing their income. Deductible, residual, and total tax rates are not commonly used terms in tax calculations. Average tax rate is the total tax paid divided by total income earned, which is not as helpful in making decisions about how to manage income.

Your _____ Tax Rate Is the Amount of Tax Payable