If Variable a Is Negatively Correlated with Variable B, Then

question 25

Multiple Choice

If Variable A is negatively correlated with Variable B, then

• A) Variable A causes Variable B
• B) Variable B causes Variable A
• C) Both variables are caused by a third one
• D) None of the above can be stated with certainty

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Definitions:

Average Tax Rate

The percentage of total income that is paid in taxes, calculated by dividing the total tax paid by the taxpayer's total income.

Marginal Tax Rate

The percentage of tax applied to your income for each tax bracket in which you qualify.

Progressive Tax

A taxation system where the tax rate increases as the taxable amount rises, thereby imposing a higher percentage rate on those with higher incomes.

Marginal Tax Rate

The rate at which the last dollar of a person’s income is taxed, indicating the impact of an additional dollar of earnings on the amount of taxes paid.