The ________ tax rate is the percentage of additional earnings that goes to taxes.

Question

Quizplus · Accepted Answer

The marginal tax rate refers to the tax rate applied to the highest portion of an individual's income. It is the percentage of additional earnings that goes to taxes, which means that it only applies to the last dollar earned. The other options (B) net tax rate, (C) gross tax rate, (D) incremental tax rate, and (E) maximum tax rate are not commonly used terms in tax calculations.

The ________ Tax Rate Is the Percentage of Additional Earnings