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If a government provides a cash grant to an individual up to $700 per week. It is take-it or leave-it grant. In other words, if
If a government provides a cash grant to an individual up to $700 per week. It is take-it or leave-it grant. In other words, if taking the grant, workers must surrender theirjobs. Assume that workers earn $10 per hours and have 110 hours a week to work or leisure. 1. Draw a budget constraint and indifference curve of cash grant policy. Explain the behavior why workers are willing to take cash grant. 2. Assume that the government will allow individuals to receive cash grant along with theirjobs. However, the government will tax 40% for each dollar earned by individuals. Explain the impact of cash grant-tax policy
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