3. Consider a parent, with $200 in nonlabor income per week, who can earn $10 per hour working between 0 and 60 hours per week. If this parent decides to work at all, then high-quality day care will cost a fixed $100 per week. a) Draw the budget line for this sparent. snom show glatinilob (A b) Now suppose a welfare program is put in place to subsidize the cost of day care for parents working at least 20 hours per week. Suppose that as long as this parent earns less than $400 (i.e. works less than 40 hours), the full $100 cost is reimbursed. For those earning over $400 per week, the $100 rebate is reduced by $5 for every additional $10 earned (i.e. every additional hour worked), so that it is completely phased out for those earning $600 (i.e. working 60 hours). Draw a diagram that ad reflects the budget line with this new program in place. (Don't worry about being exactly proportional, just capture the main features of the program.)

3. Consider a parent, with $200 in nonlabor income per week, who can earn $10 per hour working between 0 and 60 hours per week. If this parent decides to work at all, then high-quality day care will cost a fixed $100 per week. a) Draw the budget line for this sparent. snom show glatinilob (A b) Now suppose a welfare program is put in place to subsidize the cost of day care for parents working at least 20 hours per week. Suppose that as long as this parent earns less than $400 (i.e. works less than 40 hours), the full $100 cost is reimbursed. For those earning over $400 per week, the $100 rebate is reduced by $5 for every additional $10 earned (i.e. every additional hour worked), so that it is completely phased out for those earning $600 (i.e. working 60 hours). Draw a diagram that ad reflects the budget line with this new program in place. (Don't worry about being exactly proportional, just capture the main features of the program.)

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter15: Poverty And Economic Inequality

Section: Chapter Questions

Problem 2SCQ: Jonathan is a single father with one child. He can work as a server for $6 per hour for up to 1,500...

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