Answer to Question #213101 in Macroeconomics for lilly

Question

How investment tax credit and employment tax credit can be used to address unemployment?

Answer 1

Investment tax credit offers tax incentives to companies as rewards for their investment in their business. This encourages investment and growth. Consequently, more workforce is employed, and as a result, there is a decrease in unemployment.

The employment tax credit encourages firms to keep their employees on the payroll. The credit, therefore, helps reduce unemployment.