When you are making a ﬁnancial decision, the most relevant tax rate is the _____ rate.
A) average
B) ﬁxed
C) marginal
D) total
E) variable

Question

Quizplus · Accepted Answer

The marginal tax rate is the tax rate applied to the last dollar earned, therefore it is the rate that will directly impact any additional income or deductions in a financial decision. The average, fixed, total, and variable tax rates may also be relevant, but not as directly applicable as the marginal rate.

When You Are Making a ﬁNancial Decision, the Most Relevant