-If Your Taxable Income Increases from $20,000 to $40,000,your Marginal

question 57

Multiple Choice

$$\begin{array} { c c } \text { Taxable Income } & \text { Taxes Paid } \\\$ 20,000 & \$ 0 \\40,000 & 2,000 \\60,000 & 4,000 \\80,000 & 8,500\end{array}$$
-If your taxable income increases from $20,000 to $40,000,your marginal tax rate is

• A)5 percent.
• B)7.5 percent.
• C)10 percent.
• D)12.5 percent.
• E)15 percent.

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Definitions:

Sinking Funds

A fund established by an entity to set aside money over time for the purpose of paying off debt or a major expense.

Marginal Revenue Curves

These are graphs that show the relationship between the amount of output a firm sells and the revenue it gains from selling an additional unit of output.

Competitive Firm

A company that operates in a market where there is free entry and exit and no single buyer or seller can influence the market price.

Total Revenue

refers to the full amount of income generated by the sale of goods or services before any expenses are subtracted.