Which formula below would a taxpayer use to calculate an average tax rate?
A) Taxes paid/total taxable income
B) Total taxable income/taxes paid
C) Total taxable income × taxes paid
D) Total taxable income - taxes paid)/taxable income

Question

Quizplus · Accepted Answer

To calculate an average tax rate, the taxpayer would divide the total taxes paid by their total taxable income. This calculation gives the taxpayer an idea of their overall tax burden as a percentage of their income. Choice A is the correct formula for this calculation.

Which Formula Below Would a Taxpayer Use to Calculate an Average