Table 12-12
-Refer to Table 12-12. If the government imposes a $2,000 lump-sum tax, the average tax rate for Marcia and Charles would be
A)5 percent and 6.7 percent, respectively.
B)8 percent and 6 percent, respectively.
C)12 percent and 9 percent, respectively.
D)13 percent and 10 percent, respectively.

Question

Table 12-12 
-Refer to Table 12-12. If the government imposes a $2,000 lump-sum tax, the average tax rate for Marcia and Charles would be
A)5 percent and 6.7 percent, respectively. 
B)8 percent and 6 percent, respectively. 
C)12 percent and 9 percent, respectively. 
D)13 percent and 10 percent, respectively.

Quizplus · Accepted Answer

A lump-sum tax is a fixed amount, so the average tax rate is calculated by dividing the tax by income. For Marcia, $2,000/$40,000 = 5%. For Charles, $2,000/$30,000 = 6.7%.

Table 12-12 -Refer to Table 12-12. If the Government Imposes a $2,000