Question 1

According to the ideas behind utilitarian justice, a dollar in the hands of a rich person is worth less than a dollar in the hands of a poor person.

Accepted Answer

A) True 
 B)False

Question 2

The United States is the only country to face increasing inequality in their income distribution in the last several decades.

Accepted Answer

A) True 
 B)False

Question 3

A medical student's internship at a local hospital is an example of

Accepted Answer

A)  an investment in human capital. 
B)  a compensating wage differential. 
C)  economic income. 
D)  income redistribution. 
A)  an investment in human capital. 
B)  a compensating wage differential. 
C)  economic income. 
D)  income redistribution.

Question 4

If an aid program is mandated at the federal level, all states must abide by federal law and pay the same amount of benefits.

Accepted Answer

A) True 
 B)False

Question 5

As the distribution of income becomes more equal, the Lorenz curve comes closer to the 45-degree line.

Accepted Answer

A) True 
 B)False

Question 6

According to the International Monetary Fund, the central force in the growth in income inequality around the world has been

Accepted Answer

A)  population growth. 
B)  increased poverty. 
C)  technological change. 
D)  the increase in infectious disease. 
A)  population growth. 
B)  increased poverty. 
C)  technological change. 
D)  the increase in infectious disease.

Question 7

According to the ideas behind utilitarian justice, income redistribution from the rich to the poor decreases total utility.

Accepted Answer

A) True 
 B)False

Question 8

The Gini coefficient is

Accepted Answer

A)  the most common way of representing the income distribution graphically. 
B)  a commonly used measure of the degree of inequality in an income distribution. 
C)  a commonly used measure of the degree of inequity in a property distribution. 
D)  the ratio of the percentage of total income received by the top 20% of families to the percentage of total income received by the bottom 20% of families. 
A)  the most common way of representing the income distribution graphically. 
B)  a commonly used measure of the degree of inequality in an income distribution. 
C)  a commonly used measure of the degree of inequity in a property distribution. 
D)  the ratio of the percentage of total income received by the top 20% of families to the percentage of total income received by the bottom 20% of families.

Question 9

Nearly one in four Hispanic persons live in poverty.

Accepted Answer

A) True 
 B)False

Question 10

For all but the highest quintile, the share of market income going to each quintile is

Accepted Answer

A)  higher for after-tax income than for before-tax income. 
B)  lower for after-tax income than for before-tax income. 
C)  equal for after-tax income but unequal for before-tax income. 
D)  unequal for after-tax income but equal for before-tax income. 
A)  higher for after-tax income than for before-tax income. 
B)  lower for after-tax income than for before-tax income. 
C)  equal for after-tax income but unequal for before-tax income. 
D)  unequal for after-tax income but equal for before-tax income.

Question 11

An equal distribution of income would yield a Lorenz curve that is a

Accepted Answer

A)  line lying directly on the horizontal axis. 
B)  line lying directly on the vertical axis at 0%. 
C)  45-degree line between 0 and 100%. 
D)  line lying directly on the vertical axis at 100%. 
A)  line lying directly on the horizontal axis. 
B)  line lying directly on the vertical axis at 0%. 
C)  45-degree line between 0 and 100%. 
D)  line lying directly on the vertical axis at 100%.

Question 12

Evidence suggests that income inequality in China is

Accepted Answer

A)  increasing relatively rapidly. 
B)  increasing relatively slowly. 
C)  decreasing relatively rapidly. 
D)  decreasing relatively slowly. 
A)  increasing relatively rapidly. 
B)  increasing relatively slowly. 
C)  decreasing relatively rapidly. 
D)  decreasing relatively slowly.

Question 13

In the United States in 2017, women's wages were 79 percent of men's wages.

Accepted Answer

A) True 
 B)False

Question 14

The official poverty line in the United States is set

Accepted Answer

A)  equal to one-half the average income in the United States. 
B)  at three times the cost of the Department of Agriculture's minimum food budget. 
C)  at three times the cost of the Department of Housing's minimum housing allowance. 
D)  at the amount necessary to allow an individual to buy the same market basket of goods that the average urban wage earner can afford. 
A)  equal to one-half the average income in the United States. 
B)  at three times the cost of the Department of Agriculture's minimum food budget. 
C)  at three times the cost of the Department of Housing's minimum housing allowance. 
D)  at the amount necessary to allow an individual to buy the same market basket of goods that the average urban wage earner can afford.

Question 15

A theory of ________ that concludes that the social contract emerging from the original position would call for an income distribution that would maximize the well-being of the worst-off member of society is known as Rawlsian justice.

Accepted Answer

A)  utilitarian justice 
B)  distributional justice 
C)  labor value 
D)  legal equity 
A)  utilitarian justice 
B)  distributional justice 
C)  labor value 
D)  legal equity

Question 16

The largest in-kind transfer program in the United States is (are)

Accepted Answer

A)  Medicare and Medicaid. 
B)  the Housing Program. 
C)  SNAP. 
D)  Welfare. 
A)  Medicare and Medicaid. 
B)  the Housing Program. 
C)  SNAP. 
D)  Welfare.

Question 17

Households derive the majority of their income from

Accepted Answer

A)  wages and salaries. 
B)  property. 
C)  inherited wealth. 
D)  government transfers. 
A)  wages and salaries. 
B)  property. 
C)  inherited wealth. 
D)  government transfers.

Question 18

Refer to the information provided in Figure 18.1 below to answer the question(s) that follow.   Figure 18.1
-Refer to Figure 18.1. The second-wealthiest fifth of families earned ________% of income in Outland.

Accepted Answer

A)  17 
B)  25 
C)  60 
D)  95 
A)  17 
B)  25 
C)  60 
D)  95

Question 19

If the cost of the Department of Agriculture's minimum food budget for two people is $3,000 per year, the official poverty line for a family of two would be

Accepted Answer

A)  $1,000. 
B)  $3,000. 
C)  $9,000. 
D)  $18,000. 
A)  $1,000. 
B)  $3,000. 
C)  $9,000. 
D)  $18,000.

Question 20

Studies of the income tax show that its burden as a percentage of income

Accepted Answer

A)  remains about the same as income increases. 
B)  decreases as income rises. 
C)  rises slightly as income rises. 
D)  initially increases and then decreases as income increases. 
A)  remains about the same as income increases. 
B)  decreases as income rises. 
C)  rises slightly as income rises. 
D)  initially increases and then decreases as income increases.

Exam 18: Income Distribution and Poverty

According to the ideas behind utilitarian justice, a dollar in the hands of a rich person is worth less than a dollar in the hands of a poor person.

The United States is the only country to face increasing inequality in their income distribution in the last several decades.

A medical student's internship at a local hospital is an example of

If an aid program is mandated at the federal level, all states must abide by federal law and pay the same amount of benefits.

As the distribution of income becomes more equal, the Lorenz curve comes closer to the 45-degree line.

According to the International Monetary Fund, the central force in the growth in income inequality around the world has been

According to the ideas behind utilitarian justice, income redistribution from the rich to the poor decreases total utility.

The Gini coefficient is

Nearly one in four Hispanic persons live in poverty.

For all but the highest quintile, the share of market income going to each quintile is

An equal distribution of income would yield a Lorenz curve that is a

Evidence suggests that income inequality in China is

In the United States in 2017, women's wages were 79 percent of men's wages.

The official poverty line in the United States is set

A theory of ________ that concludes that the social contract emerging from the original position would call for an income distribution that would maximize the well-being of the worst-off member of society is known as Rawlsian justice.

The largest in-kind transfer program in the United States is (are)

Households derive the majority of their income from

Refer to the information provided in Figure 18.1 below to answer the question(s) that follow. Figure 18.1 -Refer to Figure 18.1. The second-wealthiest fifth of families earned ________% of income in Outland.

If the cost of the Department of Agriculture's minimum food budget for two people is $3,000 per year, the official poverty line for a family of two would be

Studies of the income tax show that its burden as a percentage of income

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Monopoly and Antitrust Policy

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

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