Using Information from the Table Below,calculate the Average Tax Rate

question 187

Essay

Using information from the table below,calculate the average tax rate and marginal tax rate as income changes from 20,000 to 50,000 and from 50,000 to 100,000 for tax system A,B,and C.Describe the relationship between average tax rates and marginal tax rates for each of these three systems.Which rate is more relevant for judging the vertical equity of a tax system

---

Definitions:

Financial Meltdown

A severe and sudden downturn in financial markets, leading to a loss of asset values and confidence in the financial system.

Economic Model

A simplified representation of economic processes, used to analyze and predict economic behaviors and outcomes.

Economists

Professionals specializing in the study of economies, analyzing the production, distribution, and consumption of goods and services.

Simulate

To imitate the operation of a real-world process or system over time for purposes of experiment or training.