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How does the rate of a proportional tax change with income? A. The rate increases as income increases.
B. The rate remains the same, even if income increases or decreases.
C. The rate decreases as income increases.
D. The rate decreases as income decreases.
The correct answer is B. The rate remains the same, even if income increases or decreases.
In a proportional tax system, the tax rate is fixed and does not change with the level of income. This means that everyone pays the same percentage of their income, regardless of how much they earn.