Part 1: Multiple Choice Questions (3 pts for each question) 1 Prior to an expanded child care subsidy program in Illinois, the labor force participation rate of single mothers in Illinois was 45% and in Wisconsin was 48%. After Illinois expanded its child care subsidy program, the participation rate increased to 58% in Illinois and to 51% in Wisconsin. The expanded child care program in Illinois is estimated to increase labor force participation of single mothers by how much according to a difference-in-differences estimator? A. 3% B6% C. 7% D. 10% 2. The Earned Income Tax Credit is a federal program that A increases the wages of minorities. B. provides cash assistance to the non-working poor C provides cash assistance to firms that hire single mothers living in poverty D. increases wages for the working poor. 3. The intertemporal substitution hypothesis suggests that hours of work should A. be greatest during peak wage years. B. steadily increase with age. C. steadily decrease with age. D. be greater for women than for men Which one of the following conclusions is not supported by the intertemporal substitution hypothesis? A. The profile of hours of work over the life cycle will have roughly the same shape as the age-earnings profile. B. Hours of work over the life cycle will be inversely related to wages over the life cycle C. Hours of work increase as the wage rises and decline as the wage falls D. An unemployed person might choose to become a discouraged worker during a low- wage recession with an eye toward returning to the labor market when wages increase. 5. Reducing the fixed monetary costs associated with working may A) cause an individual to work less B) cause an individual to work more