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In: Economics

3. The Targeted Jobs Tax Credit existed from 1979 through 1994 and offered employers a tax...

3. The Targeted Jobs Tax Credit existed from 1979 through 1994 and offered employers a tax credit for each less-skilled worker they employed. Assume that the tax credit was fixed at $3 per hour worked by a less-skilled worker.

How would this tax credit have affected the demand curve for less-skilled workers? What are the predicted effects on wages and employment? Use a graph to illustrate your answer.

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