Assume that the government proposes a negative income tax that calculates the taxes owed as follows: taxes owed equal 30% of income less 12,000. A family that earns an income of $60,000 will
A) pay $6,000 in taxes.
B) receive an income subsidy of $6,000.
C) receive an income subsidy of $12,000.
D) have an after-tax income of $48,000.
Correct Answer:
Verified
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