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10 November, 07:52

Suppose the government implements a negative income tax plan to deal with the poverty problem. The negative income tax rate is set at 50%, and the break-even level of income is set at $5,000. The guaranteed annual income level assured each family, regardless of the amount of income earned by the family, is

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  1. 10 November, 09:38
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    At least $2,500. If the family's income was $0, then the government will transfer $2,500 to them.

    Explanation:

    A negative income tax refers to a welfare system where individuals earning below a certain amount, instead of being taxed, receive money transfers from the government.
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