Deck 12: Social Welfare Programs

Question 1

An implicit tax rate of 100 percent on additional earnings for social assistance recipients not working, which represents a disincentive to enter the labour force, is referred to as

A)a welfare wall.
B)a negative income tax.
C)a negative work incentive.
D)welfare dependence.

Answer 1

a welfare wall.

Question 2

The federal government transfers cash to low-income individuals directly through the tax system using a refundable tax credit known as the

A)Working Income Tax Benefit (WTIB).
B)Canada Assistance Plan (CAP).
C)Canada Child Tax Benefit (CCTB).
D)Canada Social Transfer (CST).

Answer 2

Working Income Tax Benefit (WTIB).

Question 3

Increasing the wage rate will cause people to work more.

A)True
B)False
C)Uncertain

Answer 3

Uncertain

Question 4

The federal government program that provides open-ended matching grants to the provinces, covering 50 percent of their eligible expenditures on social welfare, is called the

A)Canada Child Tax Benefit (CCTB).
B)Canada Assistance Plan (CAP).
C)Working Income Tax Benefit (WTIB).
D)Canada Social Transfer (CST).

Question 5

How an individual on welfare responds to incentives to work depends on the individual's

A)wage rate.
B)budget constraint.
C)indifference curves.
D)welfare entitlement.

Question 6

The federal government transfers cash to low-income individuals directly through the tax system using a refundable tax credit known as the Canada Social Transfer (CST).

A)True
B)False
C)Uncertain

Question 7

Using Statistics Canada's low income cut-off lines, welfare incomes were below the poverty line in 2013.

A)True
B)False
C)Uncertain

Question 8

The low income rate was percent in 2011.

A)6.8
B)15.7
C)12.9
D)5.1

Question 9

What is true about social insurance?

A)Participation is compulsory.
B)Benefits are paid out when adverse events occur.
C)It is not intended to redistribute income.
D)All of these answers are correct.

Question 10

The need for social assistance is generally higher when the unemployment rate is lower.

A)True
B)False
C)Uncertain

Question 11

Increasing the clawback rate work effort.

A)has no effect on
B)discourages
C)involves
D)encourages

Question 12

Workfare requires able-bodied individuals to participate in work-related activities in order to receive transfer payments.

A)True
B)False
C)Uncertain

Question 13

Social assistance benefits are largest for the

A)disabled person.
B)couple with two children.
C)single parent with one child.
D)single employable.

Question 14

Social assistance payments are calculated as the difference between assessed needs and available resources.

A)True
B)False
C)Uncertain

Question 15

Empirical evidence suggests that for young people, using the welfare system creates welfare dependency.

A)True
B)False
C)Uncertain

Question 16

An example of a program with negative income tax characteristics is the

A)Child Tax Benefit.
B)Guaranteed Income Supplement.
C)GST tax credit.
D)all of these answers are correct.

Question 17

More generous benefits increase the number of those on welfare as well as the duration.

A)True
B)False
C)Uncertain

Question 18

An example of what economists refer to leisure is

A)watching "Hockey Night in Canada."
B)doing laundry.
C)mowing the lawn.
D)all of these answers are correct.

Question 19

There is a single welfare system in Canada across all provinces and territories.

A)True
B)False
C)Uncertain

Question 20

Social benefits for a couple with two children are the largest in

A)Prince Edward Island.
B)Saskatchewan.
C)Newfoundland and Labrador.
D)Yukon.

Question 21

A needy family consisting of a mother and three children currently receives cash benefits of $12 per day. The mother of this family is allowed to earn $4 per day before her benefits begin to decline. After that, for each dollar earned, cash benefits decline by 67 cents for each dollar earned. Assume that she can find work at $4 per hour. How many hours will she have to work per day before her benefits are eliminated?

Question 22

A is an income support program in which all individuals or families are guaranteed a basic annual income, even if they have zero earnings.

A)Low Income Cut-Off (LICO)
B)Negative Income Tax (NIT)
C)Working Income Tax Benefit (WTIB)
D)Workfare

Question 23

A negative income tax likely reduces the incentive to work for the working poor.

A)True
B)False
C)Uncertain

Question 24

What are some of the drawbacks, as you see them, to a program like workfare?

Question 25

An individual receives welfare benefits of $1,121 per month if he doesn't work. He can find work for $15 per hour. For every dollar earned working, benefits are reduced by $0.35. What is the individual's total income if he works 40 hours a month?

Question 26

In Toronto, a welfare recipient can earn $90 per month without having her benefits reduced. Beyond
$90, benefits are reduced by 57 cents for every dollar of earnings. Consider Jackie, a resident of Toronto, who can earn $10 per hour. If she does not work at all, she is eligible for welfare benefits of
$577.
(A)If she works 10 hours, how much are her work earnings, how much is her welfare benefits, and how much is her total income?
(B)After Jackie works a certain number of hours, she does not receive any benefits at all. What is th number of hours?

Question 27

Social assistance

A)is only provided to the unemployed.
B)is intended to redistribute income.
C)is not intended to redistribute income.
D)is not a program offered in Canada.

Question 28

Welfare is a provincial responsibility but the federal government plays a role. What are the different social assistance programs the federal government offers? Provide a brief description of each.