Leo Is a Welfare Recipient Who Qualifies for Two Means-Tested

question 70

Multiple Choice

Leo is a welfare recipient who qualifies for two means-tested cash benefit programs. If he does not earn any income, he receives $225 from each program. For each dollar he earns (which his employer is required to report to the welfare agency) , his benefit from each program is reduced by 75 cents until the benefit equals zero. When Leo's earnings are less than $300, each extra dollar he earns causes his total income (earnings plus benefits) to:

• A)fall by 25 cents.
• B)rise by 50 cents.
• C)fall by 50 cents.
• D)rise by 75 cents.

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Definitions:

Pooled Estimator

A statistical method that combines estimates from different sources or samples to arrive at a more accurate or comprehensive estimate.

Population Proportion

Population Proportion represents the fraction or percentage of members in a population that exhibit a particular attribute or characteristic.

MPG

Stands for Miles Per Gallon, a measure to estimate the distance a vehicle can travel per gallon of fuel.

Pooled Estimator

A statistical method used to estimate the mean of two or more groups by assuming that they have the same variance.