PSAT Math Multiple-Choice Question 741: Answer and Explanation

Question: 741

A politician proposes a new federal tax bracket system for single tax payers with the following tax rates for the given ranges of income:

Taxable Income Range	Tax Rate
$0 up to $9,000	15%
Greater than $9,000 up to $50,000	20%
Greater than $50,000	30%

If Julian has $62,000 in taxable income, what is the total amount of federal tax he would pay under the proposed system?

• A. $9,300
• B. $12,400
• C. $13,150
• D. $15,000

Correct Answer: C

Explanation:

(C) Take how much money from the $62,000 total falls in each tax bracket, and calculate the amount of tax applied to it:

First, $9,000 at 15% = $9,000 × 0.15 = $1,350

Next, $41,000 at 20% = $41,000 × 0.20 = $8,200

Next, $12,000 at 30% = $12,000 × 0.30 = $3,600

Finally, $1,350 + $8,200 + $3,600 = $13,150 total

As an alternative solution or as a way of checking your math, you could estimate. The answer must fall somewhere within the range of 15% to 30% of $62,000 since all of the tax brackets are within this range. Most of the money is taxed at 20%, so the answer should be close to 20%. Since more money is taxed at 30% and since 30% is twice as far away from 20% as is 15%, the amount of tax should be a bit more than 20% of the total. 20% of $62,000 is $12,400, and the answer is a bit greater than this.