You are in the 25% income tax bracket. Your employer offers health insurance as a benefit...

You are in the 25% income tax bracket. Your employer offers health insurance as a benefit valued at $4000 per year. Or your employer is offering you $4000 cash if you do not accept the health benefit. If making a rational economic decision, which option do you take?

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Expert Solution

I think you are saying that 4000 cash is one time benefit. In that case health insurance of 4000 is best decision because it can be taken throughout your working life. If cash of 4000 is also per year then taking 4000 cash is better because it will be received with certainty. However one doesn't fall I'll quite often so the 4000 health insurance benefit is not going to save money always.

Rahul Sunny answered 1 year ago

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