Question

True or False?

1. David and Nate work for two different companies, but each performs the same job working on a loading dock. David, however, earns a higher salary than his friend Nate The difference in salary could illustrate union wages if David’s annual salary is covered by a collective bargaining agreement and Nate’s is not.

2. Critics argue that a disadvantage of the Earned Income Tax Credit is that it does not effectively target the working poor because many recipients are the teenage children of middle-income families.

3. Critics argue that a disadvantage of minimum-wage laws is that they do not effectively target the working poor because many minimum-wage workers are the teenage children of middle-income families.

4. One example of labor-market discrimination is that a firm may be less likely to interview a job candidate whose resume clearly indicates he is not a good fit for the job.

Answer 1

1. Collective bargaining agreement means anagreement in writing or writings between an employer and a trade union setting forth the terms and conditions of employment or containing provisions in regard to rates of pay, hours of work or other working conditions of employees.

David and Nate work for two different companies, but each performs the same job working on a loading dock. David, however, earns a higher salary than his friend Nate The difference in salary could illustrate union wages if David’s annual salary is covered by a collective bargaining agreement and Nate’s is not- TRUE

2. Earned Income Tax Credit (EITC) has the dual purpose of promoting work and improving the lives of poor children, it is a refundable tax credit that subsidizes the earnings of low-income households. EITC benefits vary according to the filing status of a taxpayer (single or married), the number of dependents claimed by the filer (childless, one child, two children, or three or more children), and total household earnings. Reflecting the program’s goal of reducing child poverty, families with more dependents receive larger EITC benefits. It provides substantial support to low- and moderate-income working parents, but very little support to workers without qualifying children (often called childless workers). Workers receive a credit equal to a percentage of their earnings up to a maximum credit. Both the credit rate and maximum credit vary by family size, with larger credits available to families with more children. By design, the credit only benefits working families. Families with children receive a much larger credit than workers without qualifying children.

Thus the given statement is FALSE

3.

Minimum-wage workers are older than they used to be. Their average age is 35, and 88 percent are at least 20 years old. Half are older than 30, and about a third are at least 40. the minimum wage is not nearly as well targeted toward poverty reduction as the earned-income tax credit, a wage subsidy whose receipt, unlike the minimum wage, is predicated on family income.

Still, a minimum-wage increase does much more to help low- and moderate-income households than any other groups. A substantial number of minimum-wage workers come from better-off families.

Hence the said statement is TRUE.

4. Labour Market Discrimination occurs when there are different earnings and employment opportunities across equally skilled workers employed in the same job because of workers’ race, gender, national origin, sexual orientation, age, religion, ‘beauty’ etc.

Hence One example of labor-market discrimination is that a firm may be less likely to interview a job candidate whose resume clearly indicates he is not a good fit for the job- in this case it may not be termed labour market discrimination, it is owing to the qualifications of the candidate.