True or False?

1. David and Nate work for two different companies, but each performs the same job working on a loading dock. David, however, earns a higher salary than his friend Nate The difference in salary could illustrate union wages if Davids annual salary is covered by a collective bargaining agreement and Nates is not.

2. Critics argue that a disadvantage of the Earned Income Tax Credit is that it does not effectively target the working poor because many recipients are the teenage children of middle-income families.

3. Critics argue that a disadvantage of minimum-wage laws is that they do not effectively target the working poor because many minimum-wage workers are the teenage children of middle-income families.

4. One example of labor-market discrimination is that a firm may be less likely to interview a job candidate whose resume clearly indicates he is not a good fit for the job.

5. Suppose the government implemented a negative income tax and used the following formula to compute a familys tax liability:

Taxes owed = (1/4 of income) - $14,000

Refer to this scenario, A family earning $40,000 before taxes will owe tax.