Question 1

In the United States, inequality has increased over the past 25 years, in part because of rapid technological change.

Accepted Answer

A) True 
 B)False

Question 2

The poverty line is adjusted each year to reflect:

Accepted Answer

A)  changes in the cost of living. 
B)  changes in the size of the average family. 
C)  the long-term rise in the average standard of living. 
D)  changes in the cost of living and changes in the size of the average family. 
A)  changes in the cost of living. 
B)  changes in the size of the average family. 
C)  the long-term rise in the average standard of living. 
D)  changes in the cost of living and changes in the size of the average family.

Question 3

What are the fundamental differences between the Medicare and Medicaid programs?

Accepted Answer

Medicare is not a means-tested program.

Question 4

Becky works for a large grocery store that provides a health insurance program to all workers. This is an example of:

Accepted Answer

A)  Medicaid. 
B)  employment-based health insurance. 
C)  government health insurance. 
D)  a single-payer health care system. 
A)  Medicaid. 
B)  employment-based health insurance. 
C)  government health insurance. 
D)  a single-payer health care system.

Question 5

Children raised in poverty are more likely to live in poverty as adults than are other children, because low income is highly correlated with higher:

Accepted Answer

A)  high school dropout rates. 
B)  risk of mental problems and behavioral disorders. 
C)  rates of illness and hospitalization. 
D)  high school dropout rates, risk of mental problems and behavioral disorders, and rates of illness and hospitalization. 
A)  high school dropout rates. 
B)  risk of mental problems and behavioral disorders. 
C)  rates of illness and hospitalization. 
D)  high school dropout rates, risk of mental problems and behavioral disorders, and rates of illness and hospitalization.

Question 6

An example of a social insurance program is:

Accepted Answer

A)  expenditure on national defense. 
B)  Social Security payments to the disabled. 
C)  the food stamp program. 
D)  purchasing a new city police car. 
A)  expenditure on national defense. 
B)  Social Security payments to the disabled. 
C)  the food stamp program. 
D)  purchasing a new city police car.

Question 7

Given that the definition of poverty has not been adjusted to reflect the long-term rise in average incomes, you would expect _____ in the percentage of the population living below the poverty line.

Accepted Answer

A)  a decrease 
B)  an increase 
C)  no change 
D)  It is impossible to determine how the percentage of the population living in poverty might change. 
A)  a decrease 
B)  an increase 
C)  no change 
D)  It is impossible to determine how the percentage of the population living in poverty might change.

Question 8

Which of the following programs is NOT an antipoverty program?

Accepted Answer

A)  the Earned Income Tax Credit 
B)  Temporary Assistance for Needy Families 
C)  Social Security 
D)  Medicaid 
A)  the Earned Income Tax Credit 
B)  Temporary Assistance for Needy Families 
C)  Social Security 
D)  Medicaid

Question 9

In the United States in the first two decades following World War II:

Accepted Answer

A)  income distribution in the United States became less equal. 
B)  income equality measures stayed the same. 
C)  income distribution became more nearly equal. 
D)  there was no way to determine income distribution. 
A)  income distribution in the United States became less equal. 
B)  income equality measures stayed the same. 
C)  income distribution became more nearly equal. 
D)  there was no way to determine income distribution.

Question 10

Explain what is meant by the adverse selection problem, which has the potential to doom a private health insurance company to failure.

Accepted Answer

The individual consumer has some idea of

Question 11

Poverty programs are aimed at:

Accepted Answer

A)  keeping people from earning less than $10,000. 
B)  people who have run into problems paying for high-priced gas. 
C)  reducing the percentage of families living below the poverty line. 
D)  Social Security recipients. 
A)  keeping people from earning less than $10,000. 
B)  people who have run into problems paying for high-priced gas. 
C)  reducing the percentage of families living below the poverty line. 
D)  Social Security recipients.

Question 12

Food stamps, Medicaid, and housing subsidies are all:

Accepted Answer

A)  negative income taxes. 
B)  unemployment benefits. 
C)  in-kind transfers. 
D)  part of the Temporary Assistance for Needy Families program. 
A)  negative income taxes. 
B)  unemployment benefits. 
C)  in-kind transfers. 
D)  part of the Temporary Assistance for Needy Families program.

Question 13

Which of the following countries has a health care system that directly employs health care workers and runs hospitals and clinics that are free to the public?

Accepted Answer

A)  United States 
B)  Canada 
C)  France 
D)  Great Britain 
A)  United States 
B)  Canada 
C)  France 
D)  Great Britain

Question 14

Insurance companies attempt to minimize adverse selection by:

Accepted Answer

A)  relying on the government to pay for health insurance. 
B)  screening and employment-based health insurance. 
C)  relying on the free market to allocate risk efficiently. 
D)  charging high premiums to young, healthy people. 
A)  relying on the government to pay for health insurance. 
B)  screening and employment-based health insurance. 
C)  relying on the free market to allocate risk efficiently. 
D)  charging high premiums to young, healthy people.

Question 15

A high-income household is taxed a certain amount of money. A low-income household receives financial assistance in the same amount from government. The value of the marginal dollar of the financial assistance to the family and the taxes paid by the high-income family are:

Accepted Answer

A)  the same, since it is the same amount of money. 
B)  different, since the marginal dollar is worth more to the low-income family. 
C)  different, since the high-income family's lost income will keep them from buying necessities. 
D)  unimportant in determining the impact of this plan on the welfare state. 
A)  the same, since it is the same amount of money. 
B)  different, since the marginal dollar is worth more to the low-income family. 
C)  different, since the high-income family's lost income will keep them from buying necessities. 
D)  unimportant in determining the impact of this plan on the welfare state.

Question 16

Means-tested programs are available only to those with sufficiently low income. An example of a means-tested program is Temporary Assistance for Needy Families.

Accepted Answer

A) True 
 B)False

Question 17

A negative income tax is levied on firms even if they have negative income.

Accepted Answer

A) True 
 B)False

Question 18

Over the past two decades, the share of income going to the richest Americans has _____ than the share going to the poorest Americans.

Accepted Answer

A)  risen faster 
B)  risen more slowly 
C)  fallen faster 
D)  fallen more slowly 
A)  risen faster 
B)  risen more slowly 
C)  fallen faster 
D)  fallen more slowly

Question 19

Which of the following countries does NOT provide health care to all of its citizens?

Accepted Answer

A)  United States 
B)  Canada 
C)  France 
D)  Great Britain 
A)  United States 
B)  Canada 
C)  France 
D)  Great Britain

Question 20

Some nations, including Canada, have adopted a health care system in which the government pays the medical bills. This is known as a(n) _____ system.

Accepted Answer

A)  employment-based 
B)  private health insurance 
C)  means-tested 
D)  single-payer 
A)  employment-based 
B)  private health insurance 
C)  means-tested 
D)  single-payer

In the United States, inequality has increased over the past 25 years, in part because of rapid technological change.

The poverty line is adjusted each year to reflect:

What are the fundamental differences between the Medicare and Medicaid programs?

Becky works for a large grocery store that provides a health insurance program to all workers. This is an example of:

Children raised in poverty are more likely to live in poverty as adults than are other children, because low income is highly correlated with higher:

An example of a social insurance program is:

Given that the definition of poverty has not been adjusted to reflect the long-term rise in average incomes, you would expect _____ in the percentage of the population living below the poverty line.

Which of the following programs is NOT an antipoverty program?

In the United States in the first two decades following World War II:

Explain what is meant by the adverse selection problem, which has the potential to doom a private health insurance company to failure.

Poverty programs are aimed at:

Food stamps, Medicaid, and housing subsidies are all:

Which of the following countries has a health care system that directly employs health care workers and runs hospitals and clinics that are free to the public?

Insurance companies attempt to minimize adverse selection by:

A high-income household is taxed a certain amount of money. A low-income household receives financial assistance in the same amount from government. The value of the marginal dollar of the financial assistance to the family and the taxes paid by the high-income family are:

Means-tested programs are available only to those with sufficiently low income. An example of a means-tested program is Temporary Assistance for Needy Families.

A negative income tax is levied on firms even if they have negative income.

Over the past two decades, the share of income going to the richest Americans has _____ than the share going to the poorest Americans.

Which of the following countries does NOT provide health care to all of its citizens?

Some nations, including Canada, have adopted a health care system in which the government pays the medical bills. This is known as a(n) _____ system.

First Principles

Economic Models: Trade-Offs and Trade 25

Supply and Demand

Consumer and Producer Surplus

Price Controls and Quotas: Meddling With Markets

Elasticity

Taxes

International Trade

Decision Making by Individuals Firms

The Rational Consumer

Behind the Supply Curve: Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition and Product Differentiation

Externalities

Public Goods Common Resources

Factor Markets and the Distribution of Income

Uncertainty, Risk, and Private Information

Filters

Exam 18: The Economics of the Welfare

In the United States, inequality has increased over the past 25 years, in part because of rapid technological change.

The poverty line is adjusted each year to reflect:

What are the fundamental differences between the Medicare and Medicaid programs?

Becky works for a large grocery store that provides a health insurance program to all workers. This is an example of:

Children raised in poverty are more likely to live in poverty as adults than are other children, because low income is highly correlated with higher:

An example of a social insurance program is:

Given that the definition of poverty has not been adjusted to reflect the long-term rise in average incomes, you would expect _____ in the percentage of the population living below the poverty line.

Which of the following programs is NOT an antipoverty program?

In the United States in the first two decades following World War II:

Explain what is meant by the adverse selection problem, which has the potential to doom a private health insurance company to failure.

Poverty programs are aimed at:

Food stamps, Medicaid, and housing subsidies are all:

Which of the following countries has a health care system that directly employs health care workers and runs hospitals and clinics that are free to the public?

Insurance companies attempt to minimize adverse selection by:

A high-income household is taxed a certain amount of money. A low-income household receives financial assistance in the same amount from government. The value of the marginal dollar of the financial assistance to the family and the taxes paid by the high-income family are:

Means-tested programs are available only to those with sufficiently low income. An example of a means-tested program is Temporary Assistance for Needy Families.

A negative income tax is levied on firms even if they have negative income.

Over the past two decades, the share of income going to the richest Americans has _____ than the share going to the poorest Americans.

Which of the following countries does NOT provide health care to all of its citizens?

Some nations, including Canada, have adopted a health care system in which the government pays the medical bills. This is known as a(n) _____ system.

First Principles

Economic Models: Trade-Offs and Trade 25

Supply and Demand

Consumer and Producer Surplus

Price Controls and Quotas: Meddling With Markets

Elasticity

Taxes

International Trade

Decision Making by Individuals Firms

The Rational Consumer

Behind the Supply Curve: Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition and Product Differentiation

Externalities

Public Goods Common Resources

Factor Markets and the Distribution of Income

Uncertainty, Risk, and Private Information

Filters