Wages rise before all food stamps are eliminated

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Reference no: EM131112509

A welfare recipient can receive food stamps as well as cash welfare benefits. If the food stamp allotment is set as follows,

Food stamps = $6,000 – 0.30 (Wages)

(a) How high can wages rise before all food stamps are eliminated?

(b) If the welfare formula in Problem 1 applies, what is the combined marginal tax rate of both welfare and food stamps for wages above $2,00

Reference no: EM131112509

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