Which Tax Structure Would Be an Example of a Progressive

question 257

Multiple Choice

Which tax structure would be an example of a progressive tax?

• A) $10,000 in taxes collected on $50,000 of income, and $20,000 in taxes collected on $100,000
• B) $5,000 in taxes collected on $30,000 of income, and $9,000 in taxes collected on $60,000
• C) $20,000 in taxes collected on $80,000 of income, and $40,000 in taxes collected on $160,000
• D) $4,000 in taxes collected on $20,000 of income, and $10,000 in taxes collected on $40,000

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Definitions:

Taxable Income

The amount of income used to calculate how much the entity or individual owes in taxes to the government.

Tax Bill

The amount of money owed by an individual or corporation to the taxing authorities as a result of income or other taxes.

Net Fixed Assets

The total value of a company’s fixed assets minus any accumulated depreciation.

Depreciation

An accounting method of allocating the cost of a tangible or physical asset over its useful life to account for declines in value.