Scenario: An individual earning $60,000 pays $12,000 in taxes. The marginal tax rate on any income earned above $60,000 is 25%.

[Questions 11-13 are related.]

Refer to the Scenario. When this person earns $70,000, her tax payment would be

• A.

  $2,500.

• B.

  $14,500.

• C.

  $17,500.

• D.

  $12,000

• E.

  None of the above.

Refer to the Scenario. When this person earns $70,000, her average tax rate is

• A. 20.7%.
• B. 22.5%.
• C. 25%.
• D. 12.5%
• E. None of the above.

Refer to the Scenario. Suppose this person earns $70,000 and gives a $1,000 tax deductible donation to charity. The donation reduces her tax payment by

• A. $200.
• B. $207.
• C. $250.
• D. $1000.
• E. None of the above.