13. jorge made $85,000 last year as a junior consultant for a prestigious law firm placing him in the 22%…

13. jorge made $85,000 last year as a junior consultant for a prestigious law firm placing him in the 22% tax bracket. what is true about jorges marginal and effective tax brackets? his marginal tax bracket is 22%, and his effective tax bracket is less than 22% his marginal tax bracket is less than 22%, and his effective tax bracket is 22% his marginal tax bracket and his effective tax bracket are both less than 22% his marginal tax bracket and his effective tax bracket are both 22%

13. jorge made $85,000 last year as a junior consultant for a prestigious law firm placing him in the 22% tax bracket. what is true about jorges marginal and effective tax brackets? his marginal tax bracket is 22%, and his effective tax bracket is less than 22% his marginal tax bracket is less than 22%, and his effective tax bracket is 22% his marginal tax bracket and his effective tax bracket are both less than 22% his marginal tax bracket and his effective tax bracket are both 22%

Answer

Explanation:

Step1: Define marginal and effective tax brackets

Marginal tax bracket is the rate on last - dollar earned. Effective tax bracket is total tax paid divided by total income.

Step2: Analyze marginal tax bracket

Jorge is in 22% tax bracket, so his marginal tax bracket is 22%.

Step3: Analyze effective tax bracket

In a progressive tax system, the effective tax rate is calculated on total income. Since lower - income portions are taxed at lower rates before reaching the 22% bracket, the effective tax rate (total tax / total income) will be less than the marginal tax rate. So his effective tax bracket is less than 22%.

Answer:

His marginal tax bracket is 22%, and his effective tax bracket is less than 22%