Question 1

Which of the following U.S. welfare programs is a means-tested in-kind benefit?

Accepted Answer

A)  Social Security 
B)  Temporary Assistance to Needy Families 
C)  food stamps 
D)  unemployment insurance 
A)  Social Security 
B)  Temporary Assistance to Needy Families 
C)  food stamps 
D)  unemployment insurance

Question 2

Economists believe that looking at the distribution of income by quintiles at one moment overstates the true inequality of income because:

Accepted Answer

A)  it ignores the effect of taxes. 
B)  it ignores the effect of transfer payments. 
C)  families near the bottom of the distribution in any given year may be having an unusually bad year, while those at the top may be having an unusually good one. 
D)  families near the bottom of the distribution in any given year are often having an unusually good year, while those at the top are often having an unusually bad one. 
A)  it ignores the effect of taxes. 
B)  it ignores the effect of transfer payments. 
C)  families near the bottom of the distribution in any given year may be having an unusually bad year, while those at the top may be having an unusually good one. 
D)  families near the bottom of the distribution in any given year are often having an unusually good year, while those at the top are often having an unusually bad one.

Question 3

The largest _____ program in the United States is _____.

Accepted Answer

A)  social insurance; Medicaid 
B)  social insurance; Social Security payments to retired persons 
C)  means-tested; farmers' aid 
D)  means-tested; Social Security payments to retired persons 
A)  social insurance; Medicaid 
B)  social insurance; Social Security payments to retired persons 
C)  means-tested; farmers' aid 
D)  means-tested; Social Security payments to retired persons

Question 4

Why do economists generally regard median income as a better measure of a typical American's well-being than mean income?

Accepted Answer

When all Americans are arranged from the

Question 5

_____ programs are designed to provide benefits to people whose income falls below some minimum.

Accepted Answer

A)  Means-tested 
B)  Relative income 
C)  Absolute income 
D)  Nominal income 
A)  Means-tested 
B)  Relative income 
C)  Absolute income 
D)  Nominal income

Question 6

A _____ program is one for which the recipient qualifies on the basis of _____.

Accepted Answer

A)  social insurance; income 
B)  means-tested; age 
C)  means-tested; income 
D)  social insurance; need 
A)  social insurance; income 
B)  means-tested; age 
C)  means-tested; income 
D)  social insurance; need

Question 7

How have advancements in medicine contributed to the soaring cost of health care in the United States? Isn't medical progress a good thing?

Accepted Answer

Prior to modern medical treatments, a pa

Question 8

Means-tested programs:

Accepted Answer

A)  provide benefits for all. 
B)  are poverty programs that specifically help those with low incomes. 
C)  provide benefits only for households that earn below the mean household income in the United States for a given year. 
D)  provide only in-kind benefits. 
A)  provide benefits for all. 
B)  are poverty programs that specifically help those with low incomes. 
C)  provide benefits only for households that earn below the mean household income in the United States for a given year. 
D)  provide only in-kind benefits.

Question 9

Food stamps are an example of:

Accepted Answer

A)  a negative income tax. 
B)  an in-kind benefit. 
C)  a monetary benefit. 
D)  unemployment insurance. 
A)  a negative income tax. 
B)  an in-kind benefit. 
C)  a monetary benefit. 
D)  unemployment insurance.

Question 10

In 2012, health care expenditures in the United States accounted for _____ of GDP.

Accepted Answer

A)  approximately 1% 
B)  15% to 20% 
C)  40% to 50% 
D)  over 80% 
A)  approximately 1% 
B)  15% to 20% 
C)  40% to 50% 
D)  over 80%

Question 11

How do poverty programs differ from social insurance programs?

Accepted Answer

A poverty program is designed to lessen

Question 12

Government payments to individuals for which no good or service exchanged are:

Accepted Answer

A)  spending. 
B)  purchases. 
C)  spending on goods and services. 
D)  transfer payments. 
A)  spending. 
B)  purchases. 
C)  spending on goods and services. 
D)  transfer payments.

Question 13

In most wealthy countries excluding the United States, the government pays _____ of medical costs.

Accepted Answer

A)  100% 
B)  70% to 80% 
C)  30% to 40% 
D)  less than 20% 
A)  100% 
B)  70% to 80% 
C)  30% to 40% 
D)  less than 20%

Question 14

Compared to other countries of comparable wealth, the United States has:

Accepted Answer

A)  unusually high poverty rates. 
B)  similar levels of poverty. 
C)  relatively low levels of poverty. 
D)  low levels of poverty only when relative measures of poverty are used. 
A)  unusually high poverty rates. 
B)  similar levels of poverty. 
C)  relatively low levels of poverty. 
D)  low levels of poverty only when relative measures of poverty are used.

Question 15

When adverse selection occurs, healthy people pay premiums that are _____ their actual health care costs.

Accepted Answer

A)  higher than 
B)  equal to 
C)  less than 
D)  positively correlated to 
A)  higher than 
B)  equal to 
C)  less than 
D)  positively correlated to

Question 16

Which of the following LACK(S) is (are) associated with poverty?

Accepted Answer

A)  adequate employment 
B)  education 
C)  proficiency in English 
D)  adequate employment, education, and proficiency in English 
A)  adequate employment 
B)  education 
C)  proficiency in English 
D)  adequate employment, education, and proficiency in English

Question 17

In the United States, if someone does not have health insurance, it is likely that this person:

Accepted Answer

A)  is college educated. 
B)  is a low-income worker whose employer does not provide coverage and who cannot afford private coverage. 
C)  is very ill. 
D)  will not have to worry, since government assistance is available without a means test. 
A)  is college educated. 
B)  is a low-income worker whose employer does not provide coverage and who cannot afford private coverage. 
C)  is very ill. 
D)  will not have to worry, since government assistance is available without a means test.

Question 18

Community rating is a regulation that requires:

Accepted Answer

A)  cities to give ratings to movies shown in local theaters. 
B)  insurance companies to offer the same policies for the same premium to everyone, regardless of medical history. 
C)  insurance companies to charge higher premiums to healthy people. 
D)  insurance companies to charge higher premiums to the sickest people in the community. 
A)  cities to give ratings to movies shown in local theaters. 
B)  insurance companies to offer the same policies for the same premium to everyone, regardless of medical history. 
C)  insurance companies to charge higher premiums to healthy people. 
D)  insurance companies to charge higher premiums to the sickest people in the community.

Question 19

The adverse selection death spiral occurs when private insurance companies:

Accepted Answer

A)  charge higher-than-average prices for health insurance, which in turn drives off healthy individuals and leaves only sicker, high-cost individuals, resulting in yet higher premiums the following period. 
B)  find themselves with only healthy individuals to insure. 
C)  offer health insurance at average cost, which results in losses to the company. 
D)  refuse to insure very sick individuals. 
A)  charge higher-than-average prices for health insurance, which in turn drives off healthy individuals and leaves only sicker, high-cost individuals, resulting in yet higher premiums the following period. 
B)  find themselves with only healthy individuals to insure. 
C)  offer health insurance at average cost, which results in losses to the company. 
D)  refuse to insure very sick individuals.

Question 20

Much of the rise in income inequality in the past 20 years in the United States comes from:

Accepted Answer

A)  a rising gap among the incomes of highly educated workers. 
B)  the use of median income levels instead of mean income levels. 
C)  a predictable rising gap between the incomes of highly educated and less well educated workers. 
D)  declining government controls on wage supports. 
A)  a rising gap among the incomes of highly educated workers. 
B)  the use of median income levels instead of mean income levels. 
C)  a predictable rising gap between the incomes of highly educated and less well educated workers. 
D)  declining government controls on wage supports.

Which of the following U.S. welfare programs is a means-tested in-kind benefit?

Economists believe that looking at the distribution of income by quintiles at one moment overstates the true inequality of income because:

The largest _ program in the United States is _.

Why do economists generally regard median income as a better measure of a typical American's well-being than mean income?

_____ programs are designed to provide benefits to people whose income falls below some minimum.

A _ program is one for which the recipient qualifies on the basis of _.

How have advancements in medicine contributed to the soaring cost of health care in the United States? Isn't medical progress a good thing?

Means-tested programs:

Food stamps are an example of:

In 2012, health care expenditures in the United States accounted for _____ of GDP.

How do poverty programs differ from social insurance programs?

Government payments to individuals for which no good or service exchanged are:

In most wealthy countries excluding the United States, the government pays _____ of medical costs.

Compared to other countries of comparable wealth, the United States has:

When adverse selection occurs, healthy people pay premiums that are _____ their actual health care costs.

Which of the following LACK(S) is (are) associated with poverty?

In the United States, if someone does not have health insurance, it is likely that this person:

Community rating is a regulation that requires:

The adverse selection death spiral occurs when private insurance companies:

Much of the rise in income inequality in the past 20 years in the United States comes from:

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

Which of the following U.S. welfare programs is a means-tested in-kind benefit?

Economists believe that looking at the distribution of income by quintiles at one moment overstates the true inequality of income because:

The largest _____ program in the United States is _____.

Why do economists generally regard median income as a better measure of a typical American's well-being than mean income?

_____ programs are designed to provide benefits to people whose income falls below some minimum.

A _____ program is one for which the recipient qualifies on the basis of _____.

How have advancements in medicine contributed to the soaring cost of health care in the United States? Isn't medical progress a good thing?

Means-tested programs:

Food stamps are an example of:

In 2012, health care expenditures in the United States accounted for _____ of GDP.

How do poverty programs differ from social insurance programs?

Government payments to individuals for which no good or service exchanged are:

In most wealthy countries excluding the United States, the government pays _____ of medical costs.

Compared to other countries of comparable wealth, the United States has:

When adverse selection occurs, healthy people pay premiums that are _____ their actual health care costs.

Which of the following LACK(S) is (are) associated with poverty?

In the United States, if someone does not have health insurance, it is likely that this person:

Community rating is a regulation that requires:

The adverse selection death spiral occurs when private insurance companies:

Much of the rise in income inequality in the past 20 years in the United States comes from:

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

The largest _ program in the United States is _.

A _ program is one for which the recipient qualifies on the basis of _.