Asked by Adeyemi Adeyolanu on May 04, 2024
Verified
If we want to gauge the sacrifice made by a taxpayer, we should use the
A) average tax rate.
B) marginal tax rate.
C) lump-sum tax rate.
D) sales tax rate.
Average Tax Rate
The average tax rate is the proportion of total taxable income paid in taxes, calculated by dividing the total tax paid by the total income.
Marginal Tax Rate
The rate at which the last dollar of income is taxed.
Lump-Sum Tax Rate
A tax that is a fixed amount, no matter the change in circumstance of the taxed entity. This creates a situation where the tax burden falls more heavily on those with lower income or profit.
- Achieve comprehension regarding marginal and average tax rates.
- Evaluate the effects of tax policies on economic behavior and fairness.
Verified Answer
SM
SaRiah's MommyMay 09, 2024
Final Answer :
A
Explanation :
The average tax rate, which is the total tax paid divided by total income, best measures the sacrifice made by a taxpayer because it reflects the proportion of their income that is paid in taxes.
Learning Objectives
- Achieve comprehension regarding marginal and average tax rates.
- Evaluate the effects of tax policies on economic behavior and fairness.