If a Tax Has a Progressive Rate Structure, a Taxpayer's

question 2

True/False

If a tax has a progressive rate structure, a taxpayer's average rate is greater than her marginal rate.

---

Definitions:

One-Year Return

The total percentage gain or loss on an investment over a one-year period, taking into account both price fluctuations and dividends or interest received.

Unsystematic Risk

Exposure to potential loss tied to a certain firm or field, reducible by varying investment portfolios.

Recession

A significant decline in economic activity spread across the economy, lasting more than a few months.

Inflation

The measure of how quickly the general price level of goods and services rises, depleting the ability to purchase.