In a(n) tax system, the average tax rate rises with GDP, whereas in a(n) tax system, the average tax rate falls as GDP increases.

Answer 1

In a progressive tax system, the average tax rate rises with GDP, meaning that individuals or entities with higher income levels pay a larger percentage of their income in taxes.

In a regressive tax system, the average tax rate falls as GDP increases, meaning that individuals or entities with higher income levels pay a smaller percentage of their income in taxes.

So the completed sentence would read: "In a progressive tax system, the average tax rate rises with GDP, whereas in a regressive tax system, the average tax rate falls as GDP increases."