A high-income household is taxed a certain amount of money.A low-income household receives financial assistance in the same amount from government.The value of the marginal dollar of the financial assistance to the family and the taxes paid by the high-income family are:

Question

Quizplus · Accepted Answer

The marginal dollar is worth more to the low-income family because they have fewer resources and may be facing financial hardship. In contrast, the high-income family has more resources and can absorb the tax burden more easily. Therefore, the financial assistance may have a greater impact on the low-income family's welfare than the tax burden on the high-income family.

A High-Income Household Is Taxed a Certain Amount of Money