Which of the Following Is Correct

question 89

Multiple Choice

Which of the following is correct?

• A) If your income is $20,000 and you are paying $2,000 in taxes, your marginal tax rate is 10 percent.
• B) If your income is $20,000 and you are paying $2,000 in income taxes, the income tax you are paying is progressive.
• C) If you paid $0.39 as tax from an additional dollar you earned, your marginal tax rate is 39 percent.
• D) If your marginal tax rate falls as your income increases, the tax is progressive.
• E) If your income is $20,000 and you are paying $2,000 in income taxes, the income tax you are paying is proportional.

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Definitions:

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as raw materials and direct labor costs.

Breakeven Volume

The quantity of goods or services that must be sold to cover fixed and variable costs, resulting in no profit or loss.

Units

A measure of quantity or amount used in the context of production, inventory, or sales within various sectors.

Contribution Margin

The amount by which sales revenue exceeds variable costs of production, contributing to the coverage of fixed costs and profit generation.