This preview shows page 1. Sign up to view the full content.
Unformatted text preview: Then cash welfare and health insurance are linked so that anyone on welfare also receives government health insurance. #10) Indifference curve 1 must go above the spike in the budget constraint. If indifference curve 1 goes through the spike in the budget constraint, then the single mother would have higher utility initially by working zero hours. That, however, is not the single mother you are asked to depict in this problem. #11a) If you said job training program, food stamps, and in-kind benefits you would only get two of the three points because food stamps are an example of an in-kind benefit. #11b) You were asked to give the values of the two endpoints of the budget constraint so you needed to explicitly state those two (x,y) combinations or clearly indicate them in your diagram....
View Full Document
This note was uploaded on 03/30/2009 for the course PAM 2040 taught by Professor Lewis during the Fall '07 term at Cornell University (Engineering School).
- Fall '07