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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Definitions:

Kennedy

A reference to the prominent American political family, particularly John F. Kennedy, the 35th President of the United States (1961-1963).

Latin America

A region in the Western Hemisphere comprising countries where Romance languages—primarily Spanish and Portuguese, alongside French—are predominantly spoken.

Alliance For Progress

An initiative launched by U.S. President John F. Kennedy in 1961 aimed at establishing economic cooperation between the U.S. and Latin America.

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