The Average Tax Rate Is

question 29

Multiple Choice

The average tax rate is:

• A)total taxes divided by total before-tax income.
• B)the average tax rate divided by the total tax rate.
• C)the amount taxes increase when before-tax income rises by an additional dollar.
• D)the tax rate at which the benefit of an extra dollar of taxes equals the cost of an extra dollar of taxes.

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Definitions:

Stem-and-Leaf Display

A graphical method used to display quantitative data where each number is split into a stem (the leading digits) and a leaf (the last digit).

Simpson's Paradox

A phenomenon in statistics where a trend appears in several different groups of data but disappears or reverses when these groups are combined.

Aggregated Crosstabulation

A statistical method used to analyze and summarize data between two or more categorical variables in a table format.

Unaggregated Data

Raw data collected at its most detailed or base level, not yet summarized or grouped into larger categories.