Final answer:
Both Heather and Amber have gross income due to participating in a barter transaction. In Susan's scenario, a table would show a trade-off between wages and lost government benefits, with an antipoverty program ensuring a minimum income level.
Step-by-step explanation:
In the scenario where Heather cuts hair for a living and has 2 young kids, trading haircuts for babysitting services with Amber, both parties are involved in a barter transaction. According to the IRS, the fair market value of bartered goods and services must be reported as income. Therefore, both Heather and Amber have gross income from this exchange. Gross income is defined as all income from whatever source derived, including bartering for services.
When creating a table showing Susan's potential income situation, we must incorporate her hourly wage, government support reduction based on earnings, and the resulting total income. The table helps to visualize the trade-offs between earning wages and losing equivalent government benefits. It also illustrates the effect of an antipoverty program that ensures a minimum annual income, which in Susan's case is $18,000, regardless of her working hours, until she exceeds a certain threshold of hours worked.