Marginal tax rates: Partner A, a single taxpayer, is one of two partners in a small business. As such, she receives pass-through income that is taxed at her personal tax rates. After all adjustments and deductions have been made, including the 20% qualified business income deduction, she is preparing to calculate her taxes owed for the year. Using the tax rate schedule given in the image shown below, perform the following:

a. Find the marginal tax rate for the following levels of sole proprietorship earnings before taxes: $13,700; $59,200; $89,700; $147,000; $245,000; $453,000; and $1.4 million.

b. Plot the marginal tax rates (measured on the y-axis) against the pretax income levels (measured on thex-axis).

c.Explain the relationship between these variables. As income increase to ____?____ , the marginal tax rate approaches and peaks at ____?____.

Tax Rate - Single Taxpayers -2018 Range of taxable income $0 to $9,525 9,525 to 38,700 38,700 to 82,500 82,500 to 157,500 157,500 to 200,000 200,000 to 500,000 Over 500,000 Base tax $0 953 4,454 14,090 32,090 45,690 150,690 + + (10% + (12% + (22% + (24% + (32% + (35% + (37% Tax calculation (Marginal rate x amount over base bracket) X amount over $0) x amount over 9,525) x amount over 38,700) X amount over 82,500) X amount over 157,500) x amount over 200,000) x amount over 500,000)