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Suppose the tax amount on the first $10,000 income is $0; $2000 on the next $20,000; $4000 on the next $20,000; $6000 on the next $30,000; and 40...

Suppose the tax amount on the first $10,000 income is $0; $2000 on the next $20,000; $4000 on the next $20,000; $6000 on the next $30,000; and 40 percent on any income over $80,000. Family A has income of $30,000 and Family B has income of $80,000. What is the marginal and average tax rate for each family?
Family A: marginal10 percent; average10 percent; Family B: marginal40 percent; average40 percent.
Family A: marginal10 percent; average15 percent; Family B: marginal40 percent; average20 percent.
Family A: marginal10 percent; average20 percent; Family B: marginal30 percent; average23 percent.
Family A: marginal10 percent; average6.7 percent; Family B: marginal30 percent; average15 percent.

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Family A: marginal10 percent;... View the full answer

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A: $2,000 tax is from $10,000 to $30,000, so A's marginal tax rate is 10 percent. Average tax rate is tax liability /... View the full answer

A: $2,000 tax is from $10,000 to $30,000, so A's marginal tax rate is 10 percent. Average tax rate is tax liability /... View the full answer

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