Which of the Following Statements Concerning Subsidies for Child Care

question 24

Multiple Choice

Which of the following statements concerning subsidies for child care expenses is true?

• A) They change the slope of the budget line.
• B) They tend to increase the reservation wage of working.
• C) They cause a strong substitution effect toward more working activity.
• D) They reduce the fixed costs of working.
• E) They discourage labour force participation.

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Definitions:

Formal

Pertains to actions, processes, or structures that are officially recognized and enforced by an organization or institution, often characterized by written rules and regulations.

Unobservable Components

Elements or factors within a system or process that cannot be directly seen or measured but influence outcomes.

Culture

The collective social behavior, norms, knowledge, beliefs, arts, laws, customs, capabilities, and habits of the people in these societies.

Expectations

The beliefs or forecasts people have about the future or about the outcomes of specific actions.