Welfare Recipients Are Sometimes Faced with a Withdrawal of Welfare

question 26

Multiple Choice

Welfare recipients are sometimes faced with a withdrawal of welfare benefits and an increase in income tax as their earned income rises.This creates a problem because

• A)firms become unwilling to hire people that are currently unemployed.
• B)of the powerful disincentives to work for low-income individuals.
• C)of the incentives for workers to shirk and/or retire early.
• D)of the incentives for firms to lay off workers more frequently for short periods.
• E)it is administratively difficult to track these individuals.

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