Question
Parents with a child in subsidized childcare in the province of Quebec, Canada, pay a basic amount and, depending on family income, may pay an
Parents with a child in subsidized childcare in the province of Quebec, Canada, pay a basic amount and, depending on family income, may pay an additional amount. As of January 1, 2017, families with a net income of $50,920 or less pay only the basic amount of $7.75 per day per child. Families with a net income of $161,380 or more pay a daily rate of $21.20 per child, which is composed of the basic amount plus the maximum additional amount of $13.45. How does the budget constraint for parents with four children who pay the basic amount for subsidized childcare in Quebec compare to the budget constraint they would face in the absence of the subsidy? If the subsidy were provided only for their first two children, how would their budget constraint change?
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