3. Nearly 500 million workers earning the minimum wage ($7.25) in 2022 worked part-time, which the Bureau of Labor Statistics defines as than 35 hours per week¹. Suppose a typical worker (Jessie) earns $750 per month and spends money on education and other goods. That income level qualifies Jessie for public assistance. Consider the two potential transfer programs: C: provide $350 in cash each month; V: provide $450 in a voucher restricted to training [education] a. Graph Jessie's budget constraint under each of the two programs, with education on the horizontal axis and other goods on the vertical axis. b. On separate graphs, show preferences that lead Jessie to: i. prefer the cash program (C) to the voucher program (V) ii. prefer the voucher program (V) to the cash transfer iii. be indifferent between the two programs
3. Nearly 500 million workers earning the minimum wage ($7.25) in 2022 worked part-time, which the Bureau of Labor Statistics defines as than 35 hours per week¹. Suppose a typical worker (Jessie) earns $750 per month and spends money on education and other goods. That income level qualifies Jessie for public assistance. Consider the two potential transfer programs: C: provide $350 in cash each month; V: provide $450 in a voucher restricted to training [education] a. Graph Jessie's budget constraint under each of the two programs, with education on the horizontal axis and other goods on the vertical axis. b. On separate graphs, show preferences that lead Jessie to: i. prefer the cash program (C) to the voucher program (V) ii. prefer the voucher program (V) to the cash transfer iii. be indifferent between the two programs
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![3. Nearly 500 million workers earning the minimum wage ($7.25) in 2022 worked part-time, which
the Bureau of Labor Statistics defines as than 35 hours per week¹. Suppose a typical worker
(Jessie) earns $750 per month and spends money on education and other goods. That income level
qualifies Jessie for public assistance. Consider the two potential transfer programs:
C: provide $350 in cash each month;
V: provide $450 in a voucher restricted to training [education]
a. Graph Jessie's budget constraint under each of the two programs, with education on the
horizontal axis and other goods on the vertical axis.
b. On separate graphs, show preferences that lead Jessie to:
i. prefer the cash program (C) to the voucher program (V)
ii. prefer the voucher program (V) to the cash transfer
iii. be indifferent between the two programs](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc9f3a2fc-81f4-411e-8ba7-cee66a93475f%2F6d558ba9-c0d7-4af4-a633-9bd438b3169d%2Fetdebv_processed.png&w=3840&q=75)
Transcribed Image Text:3. Nearly 500 million workers earning the minimum wage ($7.25) in 2022 worked part-time, which
the Bureau of Labor Statistics defines as than 35 hours per week¹. Suppose a typical worker
(Jessie) earns $750 per month and spends money on education and other goods. That income level
qualifies Jessie for public assistance. Consider the two potential transfer programs:
C: provide $350 in cash each month;
V: provide $450 in a voucher restricted to training [education]
a. Graph Jessie's budget constraint under each of the two programs, with education on the
horizontal axis and other goods on the vertical axis.
b. On separate graphs, show preferences that lead Jessie to:
i. prefer the cash program (C) to the voucher program (V)
ii. prefer the voucher program (V) to the cash transfer
iii. be indifferent between the two programs
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