Asked by hennebry waters on May 06, 2024
Verified
Karole's income rises from $50,000 to $75,000 and her income tax increases from $8,000 to $9,500.Her average tax rate is 6%.
Average Tax Rate
The proportion of total income that is paid as tax.
Income Tax
A tax levied by a government directly on income, especially an annual tax on personal income.
- Calculate and understand average and marginal tax rates.
Verified Answer
SG
Suheyl GodinezMay 13, 2024
Final Answer :
False
Explanation :
Karole's average tax rate after the increase is calculated by dividing the total tax paid ($9,500) by her new income ($75,000), which equals 12.67%, not 6%.
Learning Objectives
- Calculate and understand average and marginal tax rates.