Suppose day care centers charge a weekly rate no matter how many hours the child attends. A new government policy to offer a lump sum subsidy for 50 percent of the weekly cost of childcare would 0 not change any of the factors inuencing the decision to participate in the labor market. 0 shift the budget constraint rightward by the amount of the subsidy and result in fewer hours worked for parents already working in the labor market. 0 increase the effective wage for working parents and increase labor force participation among parents who are out of the labor market