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-   -   How do you calculate marginal tax rate? (https://www.askmehelpdesk.com/showthread.php?t=341221)

  • Apr 13, 2009, 09:15 PM
    ledzepfan1
    How do you calculate marginal tax rate?
    How do you calculate a marginal tax rate if all you get are these stats:

    Suppose taxes are related to income level as follows:

    INCOME / TAXES

    $1,000 / $200
    $2,000 / $350
    $3,000 / $450

    What is the marginal tax rate on the first $1,000 of income? The second? The third?

    I got the percentages of each tax level, and that it is a regressive tax, but I'm not sure how to calculate the marginal tax rate... with the information given...

    I found the answers on a website, but I want to know how to do it, in case it's on the test...
  • Oct 31, 2009, 11:59 PM
    godkilla1211
    PLEASE ANSWER THIS QUESTION!!

    Consider the following tax structure:

    Income Bracket Marginal Tax Rate
    $0-$1500 0%
    $1501-$2000 14%
    $2001-$3000 20%

    Mr. Smith has an income of $2500 per annum. Calculate his tax bill for the year. What is his average tax rate? His highest marginal tax rate?
  • Nov 1, 2009, 12:01 AM
    godkilla1211

    Re-post my question...

    PLEASE ANSWER THIS QUESTION!!

    Consider the following tax structure:

    Income Bracket:
    $0-$1500
    $1501-$2000
    $2001-$3000

    Marginal tax rate:
    0%
    14%
    20%

    Mr. Smith has an income of $2500 per annum. Calculate his tax bill for the year. What is his average tax rate? His highest marginal tax rate?
  • Nov 15, 2009, 02:00 PM
    sarafagiri
    marginal tax rate = change in amount of tax/the change in income
  • Nov 15, 2009, 02:01 PM
    sarafagiri

    What is the relationship between average tax rate and marginal tax rate?

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