Question 1

The primary function of Temporary Assistance for Needy Families has been to provide funds for reuniting families.

Accepted Answer

A) True 
 B)False

Question 2

A proportional income tax means that those with a higher income pay

Accepted Answer

A)  a lower percentage of their income in taxes than low-income people. 
B)  a higher percentage of their income in taxes than low-income people. 
C)  the same percentage of their income in taxes as low-income people. 
D)  all the taxes in the economy. 
A)  a lower percentage of their income in taxes than low-income people. 
B)  a higher percentage of their income in taxes than low-income people. 
C)  the same percentage of their income in taxes as low-income people. 
D)  all the taxes in the economy.

Question 3

In 2013, the highest incidence of poverty was for

Accepted Answer

A)  women living in households with no husband present. 
B)  individuals over 65. 
C)  Hispanic families. 
D)  children under 18. 
A)  women living in households with no husband present. 
B)  individuals over 65. 
C)  Hispanic families. 
D)  children under 18.

Question 4

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. Suppose that the Lorenz curve ________. This would mean that the distribution of income is equal.

Accepted Answer

A)  was above the 45-degree line OB 
B)  was below the 45-degree line OB 
C)  was perfectly vertical 
D)  was the same as the 45-degree line OB 
A)  was above the 45-degree line OB 
B)  was below the 45-degree line OB 
C)  was perfectly vertical 
D)  was the same as the 45-degree line OB

Question 5

If the cost of the Department of Agriculture's minimum food budget for two people is $2,000 per year, the official poverty line for a family of two would be

Accepted Answer

A)  $667. 
B)  $2,000. 
C)  $6,000. 
D)  $12,000. 
A)  $667. 
B)  $2,000. 
C)  $6,000. 
D)  $12,000.

Question 6

In 2017 about 28% of personal income in the United States came from

Accepted Answer

A)  wages and salaries. 
B)  property income. 
C)  transfer payments. 
D)  profits. 
A)  wages and salaries. 
B)  property income. 
C)  transfer payments. 
D)  profits.

Question 7

Any society bound by a contract calling for an income distribution that would maximize the well-being of the worst-off member of society would allow for inequality if that inequality

Accepted Answer

A)  was justified by differences in individuals' productivity. 
B)  had the effect of improving the lot of the very poor. 
C)  could not be reduced without making someone worse off. 
D)  was justified by the needs of individuals. 
A)  was justified by differences in individuals' productivity. 
B)  had the effect of improving the lot of the very poor. 
C)  could not be reduced without making someone worse off. 
D)  was justified by the needs of individuals.

Question 8

A Gini coefficient of one means that

Accepted Answer

A)  income is distributed equally. 
B)  one family has all the income and everyone else has nothing. 
C)  all the income is received by the top 20% of families. 
D)  the income is split equally between the top 20% and the rest of the distribution. 
A)  income is distributed equally. 
B)  one family has all the income and everyone else has nothing. 
C)  all the income is received by the top 20% of families. 
D)  the income is split equally between the top 20% and the rest of the distribution.

Question 9

The largest income redistribution program(s) in the United States is (are) the

Accepted Answer

A)  Social Security System. 
B)  Temporary Assistance to Needy Families (TANF) program. 
C)  Medicare and Medicaid programs. 
D)  Supplemental Security Income program. 
A)  Social Security System. 
B)  Temporary Assistance to Needy Families (TANF) program. 
C)  Medicare and Medicaid programs. 
D)  Supplemental Security Income program.

Question 10

Relating to the Economics in Practice on page 374: Considerable evidence suggests that recently in the United States,________ has increased and ________ has stagnated.

Accepted Answer

A)  the real wage; the nominal wage 
B)  the nominal wage of the average worker; executive compensation 
C)  executive compensation; the real wage of the average worker 
D)  the real wage for women; the real wage for men 
A)  the real wage; the nominal wage 
B)  the nominal wage of the average worker; executive compensation 
C)  executive compensation; the real wage of the average worker 
D)  the real wage for women; the real wage for men

Question 11

Of the administrative costs for the SNAP program,

Accepted Answer

A)  states pay 100 percent. 
B)  100 percent are paid out of federal tax revenues. 
C)  states bear 50 percent of the costs. 
D)  federal, state, and local governments split the costs evenly. 
A)  states pay 100 percent. 
B)  100 percent are paid out of federal tax revenues. 
C)  states bear 50 percent of the costs. 
D)  federal, state, and local governments split the costs evenly.

Question 12

Any society bound by a contract calling for an income distribution that would ________ the well-being of the worst-off member of society would allow for inequality if that inequality had the effect of ________ the lot of the very poor.

Accepted Answer

A)  minimize; improving 
B)  maximize; improving 
C)  maximize; worsening 
D)  minimize; worsening 
A)  minimize; improving 
B)  maximize; improving 
C)  maximize; worsening 
D)  minimize; worsening

Question 13

Proponents of income redistribution argue that redistribution

Accepted Answer

A)  increases the welfare of all members of society. 
B)  will not take place absent government intervention as the market for charity, a private good, is imperfect. 
C)  would be agreed to by all members of society if they were risk-loving and contracting from the "original position." 
D)  helps those who, through no fault of their own, are unable to earn an adequate income. 
A)  increases the welfare of all members of society. 
B)  will not take place absent government intervention as the market for charity, a private good, is imperfect. 
C)  would be agreed to by all members of society if they were risk-loving and contracting from the "original position." 
D)  helps those who, through no fault of their own, are unable to earn an adequate income.

Question 14

Evidence suggests that in the last several decades, technology has played a role in driving inequality. Thus, greater access to education may be key to ________ in the future.

Accepted Answer

A)  reducing inequality 
B)  increasing inequality 
C)  reducing equality 
D)  eliminating equality 
A)  reducing inequality 
B)  increasing inequality 
C)  reducing equality 
D)  eliminating equality

Question 15

Upon graduation, Shawntae had two job offers. The jobs were identical in every way with two exceptions. One job was located in Ft. Lauderdale, FL and offered an annual salary of $95,000. The other job was located in Tulsa, OK and offered an annual salary of $72,000. All else equal, the salary difference is due to

Accepted Answer

A)  compensating differentials. 
B)  discrimination. 
C)  transfer payments 
D)  the firm in Florida had a lower demand for workers than the firm in Oklahoma. 
A)  compensating differentials. 
B)  discrimination. 
C)  transfer payments 
D)  the firm in Florida had a lower demand for workers than the firm in Oklahoma.

Question 16

John Stuart Mill first proposed

Accepted Answer

A)  the idea of utilitarian justice. 
B)  the theory of distributional justice. 
C)  the labor theory of value. 
D)  the theory of comparative advantage. 
A)  the idea of utilitarian justice. 
B)  the theory of distributional justice. 
C)  the labor theory of value. 
D)  the theory of comparative advantage.

Question 17

________ is financed through general revenues.

Accepted Answer

A)  Medicare 
B)  The SNAP program 
C)  The Social Security system 
D)  Unemployment compensation 
A)  Medicare 
B)  The SNAP program 
C)  The Social Security system 
D)  Unemployment compensation

Question 18

Unemployment benefits are

Accepted Answer

A)  paid regardless of a person's income from other sources and regardless of assets. 
B)  reduced by an amount that is equal to an individual's income from other sources. 
C)  not paid to individuals with assets valued over $200,000. 
D)  paid to individuals the entire time they are unemployed regardless of how long they are unemployed. 
A)  paid regardless of a person's income from other sources and regardless of assets. 
B)  reduced by an amount that is equal to an individual's income from other sources. 
C)  not paid to individuals with assets valued over $200,000. 
D)  paid to individuals the entire time they are unemployed regardless of how long they are unemployed.

Question 19

For most families, a majority of their property comes from

Accepted Answer

A)  redistribution programs. 
B)  inheritance. 
C)  savings. 
D)  transfer payments. 
A)  redistribution programs. 
B)  inheritance. 
C)  savings. 
D)  transfer payments.

Question 20

The government transfer program makes the distribution of income more equal.

Accepted Answer

A) True 
 B)False

Exam 18: Income Distribution and Poverty

The primary function of Temporary Assistance for Needy Families has been to provide funds for reuniting families.

A proportional income tax means that those with a higher income pay

In 2013, the highest incidence of poverty was for

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. Suppose that the Lorenz curve ________. This would mean that the distribution of income is equal.

If the cost of the Department of Agriculture's minimum food budget for two people is $2,000 per year, the official poverty line for a family of two would be

In 2017 about 28% of personal income in the United States came from

Any society bound by a contract calling for an income distribution that would maximize the well-being of the worst-off member of society would allow for inequality if that inequality

A Gini coefficient of one means that

The largest income redistribution program(s) in the United States is (are) the

Relating to the Economics in Practice on page 374: Considerable evidence suggests that recently in the United States,________ has increased and ________ has stagnated.

Of the administrative costs for the SNAP program,

Any society bound by a contract calling for an income distribution that would ________ the well-being of the worst-off member of society would allow for inequality if that inequality had the effect of ________ the lot of the very poor.

Proponents of income redistribution argue that redistribution

Evidence suggests that in the last several decades, technology has played a role in driving inequality. Thus, greater access to education may be key to ________ in the future.

John Stuart Mill first proposed

________ is financed through general revenues.

Unemployment benefits are

For most families, a majority of their property comes from

The government transfer program makes the distribution of income more equal.

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

Filters

Relating to the Economics in Practice on page 374: Considerable evidence suggests that recently in the United States, has increased and has stagnated.

Any society bound by a contract calling for an income distribution that would the well-being of the worst-off member of society would allow for inequality if that inequality had the effect of the lot of the very poor.