he Earned Income Tax Credit a)is a welfare program that discourages people from entering the labor...

he Earned Income Tax Credit

a)is a welfare program that discourages people from entering the labor force

b)subsidizes wages for low income workers

c)only applies to families under the poverty level

d)is phased out by 40 cents for every dollar earned above $18,740

Solutions

Expert Solution

It shall be noted that Earned Income Tax Credit phases out on the basis of the number of children, the earner has.

Hence, option d is not correct.

It is also not only applicable to families under the poverty line.

The Earned Income Tax Credit is widely praised. A subsidy paid to low-wage workers depending on family size, the EITC expands labor force participation and increases income to families, which helps stabilize them. It helps working-poor women to become economically engaged and improves the life chances of their children by keeping them in school, providing better food, and even increasing their vocabulary.

Hence, the correct answer is b)subsidizes wages for low-income workers

Rahul Sunny answered 1 year ago

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