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    ledzepfan1's Avatar
    ledzepfan1 Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Apr 13, 2009, 09:15 PM
    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...
    godkilla1211's Avatar
    godkilla1211 Posts: 2, Reputation: 0
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    #2

    Oct 31, 2009, 11:59 PM
    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?
    godkilla1211's Avatar
    godkilla1211 Posts: 2, Reputation: 0
    New Member
    		  
    #3

    Nov 1, 2009, 12:01 AM

    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?
    sarafagiri's Avatar
    sarafagiri Posts: 2, Reputation: 1
    New Member
    		  
    #4

    Nov 15, 2009, 02:00 PM
    marginal tax rate = change in amount of tax/the change in income
    sarafagiri's Avatar
    sarafagiri Posts: 2, Reputation: 1
    New Member
    		  
    #5

    Nov 15, 2009, 02:01 PM

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