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Business, 30.07.2019 01:20 HeyItsCookie9605

Since 1979, low-income recipients have been given food stamps without charge. however, before 1979, people bought food stamps at a subsidized rate. for example, to get $1 worth of food stamps, a household paid about 20cents (the exact amount varied by household characteristics and other factors). what is the budget constraint facing an individual if that individual may buy up to $100 per month in food stamps at 20cents per each $1 coupon? compare this constraint to the original budget constraint with no assistance and the budget constraint if the individual receives $100 of food stamps for free. assume the individual has income of $120 per month.

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