A Welfare Recipient Receives $10,000 in Benefits When He Does

question 114

Multiple Choice

A welfare recipient receives $10,000 in benefits when he does not work but receives an income of $15,000 when he works part-time and earns $6,000 in wages.What is the implicit marginal tax rate the recipient faces?

• A)15.5 percent.
• B)100 percent.
• C)0 percent.
• D)16.6 percent.

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