Leonardo, Who Is Married but Files Separately, Earns $80,000 of Taxable

question 26

Multiple Choice

Leonardo, who is married but files separately, earns $80,000 of taxable income. He also has $15,000 in city of Tulsa bonds. His wife, Theresa, earns $50,000 of taxable income. If Leonardo earned an additional $30,000 of taxable income this year, what would be the marginal tax rate on the extra income for 2020? (Use tax rate schedule.) (Round your final answer to two decimal places.)

• A)22.00 percent
• B)18.81 percent
• C)24.00 percent
• D)23.62 percent
• E)None of the choices are correct

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity demanded.

Perfect Competitor

A market structure characterized by an infinite number of small firms, identical products, and free entry and exit, ensuring no single firm can influence market prices.

Industry-Wide Supply and Demand

The total quantity of goods and services that are available for purchase across an entire industry, alongside the total quantity that consumers are willing and able to buy within that industry.

Short-Run

A period in economics where at least one factor of production is fixed, and firms can't alter all inputs.