Question 1

What is meant by a perfectly equal distribution of income? Use a graph to depict such a situation.

Accepted Answer

@#IMG-DLM& ​
If income were equally distributed ac

Question 2

According to the maximin criterion, income should be transferred from the rich to the poor as long as it

Accepted Answer

A) raises the well-being of the least fortunate. 
B) does not alter incentives to work and save. 
C) promotes an equal distribution of income. 
D) does not lower the welfare of the elderly. 
A) raises the well-being of the least fortunate. 
B) does not alter incentives to work and save. 
C) promotes an equal distribution of income. 
D) does not lower the welfare of the elderly.

Question 3

The Supplemental Security Income (SSI) program focuses on the poor who are sick or disabled.

Accepted Answer

A) True 
 B)False

Question 4

The elderly represent the largest demographic group in poverty.

Accepted Answer

A) True 
 B)False

Question 5

A government policy aimed at protecting people against the risk of adverse events is called .

Accepted Answer

The answer of A government policy aimed at protecting people...

Question 6

Figure 20-3
​
   ​
-If the U.S. government determines that the cost of feeding an urban family of four is $7,500 per year, then the official poverty line for a family of that type is

Accepted Answer

A) $7,500. 
B) $15,000. 
C) $22,500. 
D) $30,000. 
A) $7,500. 
B) $15,000. 
C) $22,500. 
D) $30,000.

Question 7

What is the primary problem in comparing income inequality in the US with income inequality in other countries?

Accepted Answer

difference

Question 8

Goods and services given to the poor such as food stamps, housing vouchers, and medical services are called

Accepted Answer

The answer of Goods and services given to the poor...

Question 9

Assume that the government proposes a negative income tax that calculates taxes owed by the following formula,
Taxes Owed = (1/3 × Income) - $10,000.
Compute the tax that would be owed given each level of income.
a.$120,000
b.$90,000
c.$60,000
d.$30,000
e.$0

Accepted Answer

The answer of Assume that the government proposes a negative...

Question 10

The poverty line is set by the government so that 10 percent of all families fall below that line and are thereby classified as "poor."

Accepted Answer

A) True 
 B)False

Question 11

Suppose the government used the following formula to compute a family's tax liability:
Taxes owed = 28% of income - $8,000. How much would a family that earned $18,000 owe?

Accepted Answer

The answer of Suppose the government used the following formula...

Question 12

If in-kind transfers were included in income at their market value, what would happen to the number of families below the poverty line?

Accepted Answer

It would d

Question 13

The United States has more income inequality than Japan, Germany, and France.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is not correct?

Accepted Answer

A) A negative income tax only applies to working people, so it encourages people to get full-time work. 
B) Supporters advocate the use of the Earned Income Tax Credit as a way to help the working poor. 
C) A negative income tax subsidizes the incomes of poor people. 
D) An advantage of a negative income tax is that it is not based on the number of children, so it does not provide incentives for unmarried women to have children. 
A) A negative income tax only applies to working people, so it encourages people to get full-time work. 
B) Supporters advocate the use of the Earned Income Tax Credit as a way to help the working poor. 
C) A negative income tax subsidizes the incomes of poor people. 
D) An advantage of a negative income tax is that it is not based on the number of children, so it does not provide incentives for unmarried women to have children.

Question 15

Table 20-8
Income Inequality in the United States
The values in the table reflect the percentages of pre-tax-and transfer income.
Source: US Census Bureau
 $\begin{array}{|l|l|l|l|l|l|l|}
\hline \text { Year } & \text { Bottom Fifth } & \text { Second Fifth } & \text { Middle Fifth } & \text { Fourth Fifth } & \text { Top Fifth } & \text { Top 5\% } \
\hline \mathbf{2 0 1 0} & 3.3 \% & 8.5 \% & 14.6 \% & 23.4 \% & 50.2 \% & 21.3 \% \
\hline \mathbf{2 0 0 5} & 3.4 & 8.6 & 14.6 & 23.0 & 50.4 & 22.2 \
\hline \mathbf{2 0 0 0} & 3.6 & 8.9 & 14.8 & 23.0 & 49.8 & 22.1 \
\hline \mathbf{1 9 9 5} & 3.7 & 9.1 & 15.2 & 23.3 & 48.7 & 21.0 \
\hline \mathbf{1 9 9 0} & 3.8 & 9.6 & 15.9 & 24.0 & 46.6 & 18.5 \
\hline \mathbf{1 9 8 5} & 3.9 & 9.8 & 16.2 & 24.4 & 45.6 & 17.6 \
\hline \mathbf{1 9 8 0} & 4.2 & 10.2 & 16.8 & 24.7 & 44.1 & 16.5\
\hline

\end{array}$

-Refer to Table 20-8. In percentage terms, how much less income did the bottom 40% of families have in 2010 than in 1980?

Accepted Answer

The answer of Table 20-8
Income Inequality in the United States
The...

Question 16

The economic life cycle describes how young people usually have higher savings rates than middle-aged people.

Accepted Answer

A) True 
 B)False

Question 17

Which philosopher claimed that the government should aim to maximize the well-being of the worst-off person in society?

Accepted Answer

The answer of Which philosopher claimed that the government should...

Question 18

Aniella believes that the demand for unskilled labor is relatively inelastic. Carmella believes that the demand for unskilled labor is relatively elastic. Which believes that a minimum-wage law will result in significant unemployment?

Accepted Answer

The answer of Aniella believes that the demand for unskilled...

Question 19

Which of the following statements accurately characterizes the effects of minimum-wage laws?

Accepted Answer

A) Any worker who wants to work at the minimum wage will be employed at that wage. 
B) Those workers who remain employed are hurt by a lower wage. 
C) The effects of minimum-wage laws do not depend on the elasticity of labor supply. 
D) The effects of minimum-wage laws depend strongly on the elasticity of labor demand. 
A) Any worker who wants to work at the minimum wage will be employed at that wage. 
B) Those workers who remain employed are hurt by a lower wage. 
C) The effects of minimum-wage laws do not depend on the elasticity of labor supply. 
D) The effects of minimum-wage laws depend strongly on the elasticity of labor demand.

Question 20

A system in which anyone collecting antipoverty program benefits must accept a government-provided job is called .

Accepted Answer

The answer of A system in which anyone collecting antipoverty...

Exam 20: Income Inequality and Poverty

What is meant by a perfectly equal distribution of income? Use a graph to depict such a situation.

According to the maximin criterion, income should be transferred from the rich to the poor as long as it

The Supplemental Security Income (SSI) program focuses on the poor who are sick or disabled.

The elderly represent the largest demographic group in poverty.

A government policy aimed at protecting people against the risk of adverse events is called .

Figure 20-3 ​ ​ -If the U.S. government determines that the cost of feeding an urban family of four is $7,500 per year, then the official poverty line for a family of that type is

What is the primary problem in comparing income inequality in the US with income inequality in other countries?

Goods and services given to the poor such as food stamps, housing vouchers, and medical services are called

Assume that the government proposes a negative income tax that calculates taxes owed by the following formula, Taxes Owed = (1/3 × Income) - $10,000. Compute the tax that would be owed given each level of income. a.$120,000 b.$90,000 c.$60,000 d.$30,000 e.$0

The poverty line is set by the government so that 10 percent of all families fall below that line and are thereby classified as "poor."

Suppose the government used the following formula to compute a family's tax liability: Taxes owed = 28% of income - $8,000. How much would a family that earned $18,000 owe?

If in-kind transfers were included in income at their market value, what would happen to the number of families below the poverty line?

The United States has more income inequality than Japan, Germany, and France.

Which of the following is not correct?

The economic life cycle describes how young people usually have higher savings rates than middle-aged people.

Which philosopher claimed that the government should aim to maximize the well-being of the worst-off person in society?

Aniella believes that the demand for unskilled labor is relatively inelastic. Carmella believes that the demand for unskilled labor is relatively elastic. Which believes that a minimum-wage law will result in significant unemployment?

Which of the following statements accurately characterizes the effects of minimum-wage laws?

A system in which anyone collecting antipoverty program benefits must accept a government-provided job is called .

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Applications: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Figure 20-3 -If the U.S. government determines that the cost of feeding an urban family of four is $7,500 per year, then the official poverty line for a family of that type is