In Reference to Welfare Recipients, the High Effective Marginal Tax

question 74

Multiple Choice

In reference to welfare recipients, the high effective marginal tax rate on earnings

• A)encourages self-sufficiency
• B)encourages more labor market activity
• C)discourages employment
• D)increases total family income if the marginal tax rate exceeds 100 percent
• E)tends to increase welfare benefits as more income is earned up to the "means-test" threshold

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