Question 1

-In the figure above, the middle fifth of all households receive what share of all income?

Accepted Answer

A)  10 percent 
B)  20 percent 
C)  30 percent 
D)  40 percent 
A)  10 percent 
B)  20 percent 
C)  30 percent 
D)  40 percent

Question 2

A progressive tax is a tax that taxes income so that the average tax rate increases with income.

Accepted Answer

A) True 
 B)False

Question 3

Suppose that the income tax in the United States was such that all households had to pay 20 percent of their income to the government as taxes. This tax is an example of

Accepted Answer

A)  a regressive tax. 
B)  a proportional tax. 
C)  a progressive tax. 
D)  an efficient tax. 
A)  a regressive tax. 
B)  a proportional tax. 
C)  a progressive tax. 
D)  an efficient tax.

Question 4

-The above table shows the distribution of wealth and income in Miseria. The Lorenz curve for wealth would

Accepted Answer

A)  intersect the horizontal axis at 100 percent. 
B)  bow outward more to the right than does the Lorenz curve for income. 
C)  lie parallel to the line of equality. 
D)  become flatter as one moves from left to right. 
A)  intersect the horizontal axis at 100 percent. 
B)  bow outward more to the right than does the Lorenz curve for income. 
C)  lie parallel to the line of equality. 
D)  become flatter as one moves from left to right.

Question 5

What is meant by the term "assortative mating" and how does it affect the distribution of wealth?

Accepted Answer

Assortative mating is the tendency for p

Question 6

The table shows the distributions of market income and money income in the United States in 2007.
  
-According to the table above, ________ percent of total income is redistributed to the lowest income group.

Accepted Answer

A)  4.7 
B)  2.3 
C)  1.5 
D)  3.8 
A)  4.7 
B)  2.3 
C)  1.5 
D)  3.8

Question 7

"The Big Tradeoff" refers to the effect of redistribution on efficiency.

Accepted Answer

A) True 
 B)False

Question 8

Some economists argue that discrimination based on race and sex cannot lead to persistent wage differentials. What is their argument?

Accepted Answer

In short, wage differentials will lead t

Question 9

One possible reason the U.S. income distribution has become more unequal is

Accepted Answer

A)  information technology has decreased the demand for unskilled labor. 
B)  information technology has increased the demand for unskilled labor. 
C)  information technology has increased the supply of unskilled labor. 
D)  information technology has decreased the supply of unskilled labor. 
A)  information technology has decreased the demand for unskilled labor. 
B)  information technology has increased the demand for unskilled labor. 
C)  information technology has increased the supply of unskilled labor. 
D)  information technology has decreased the supply of unskilled labor.

Question 10

The distribution of wealth is skewed because more families are below the average level of wealth than are above.

Accepted Answer

A) True 
 B)False

Question 11

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

Accepted Answer

A)  the process of redistribution uses up some of society's resources. 
B)  the process of redistribution creates new resources for society. 
C)  redistribution creates new incentives to work for both rich and poor. 
D)  redistribution would not take place otherwise. 
A)  the process of redistribution uses up some of society's resources. 
B)  the process of redistribution creates new resources for society. 
C)  redistribution creates new incentives to work for both rich and poor. 
D)  redistribution would not take place otherwise.

Question 12

Discrimination by customers creates a wage differential between two groups by creating a difference in the two groups' perceived

Accepted Answer

A)  supply of labor. 
B)  value of marginal product. 
C)  marginal cost of labor. 
D)  minimum wage. 
A)  supply of labor. 
B)  value of marginal product. 
C)  marginal cost of labor. 
D)  minimum wage.

Question 13

A firm that discriminates has ________ a nonprejudiced firm and ________.

Accepted Answer

A)  the same costs as; competes most often with imported goods and services 
B)  the same costs as; can successfully maximize profit in a competitive industry 
C)  lower costs than; drives other firms out of a competitive industry 
D)  higher costs than; cannot survive in a competitive industry 
A)  the same costs as; competes most often with imported goods and services 
B)  the same costs as; can successfully maximize profit in a competitive industry 
C)  lower costs than; drives other firms out of a competitive industry 
D)  higher costs than; cannot survive in a competitive industry

Question 14

-In the figure above, income is most unequally distributed

Accepted Answer

A)  in Country A. 
B)  in Country B. 
C)  in Country C. 
D)  in one of the nations, but without more information, it is not possible to determine in which country income is distributed most unequally. 
A)  in Country A. 
B)  in Country B. 
C)  in Country C. 
D)  in one of the nations, but without more information, it is not possible to determine in which country income is distributed most unequally.

Question 15

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the higher productivity of high-skilled workers.

Accepted Answer

A) True 
 B)False

Question 16

The biggest single factor affecting family income distribution is the

Accepted Answer

A)  householder's age. 
B)  householder's marital status. 
C)  household size. 
D)  householder's education. 
A)  householder's age. 
B)  householder's marital status. 
C)  household size. 
D)  householder's education.

Question 17

In a Lorenz diagram for income, the line of equality shows

Accepted Answer

A)  the most equitable income distribution. 
B)  how unequally incomes are distributed. 
C)  how much redistribution occurs. 
D)  the income distribution if everyone received the same income. 
A)  the most equitable income distribution. 
B)  how unequally incomes are distributed. 
C)  how much redistribution occurs. 
D)  the income distribution if everyone received the same income.

Question 18

-The table above shows the demand for labor and supply of labor schedules for low-skilled labor. If the labor market is competitive, what is the wage rate of low-skilled labor and what is the quantity of low-skilled labor employed?

Accepted Answer

A)  $6 an hour; 60 hours a day 
B)  $6 an hour; 65 hours a day 
C)  $4 an hour; 70 hours a day 
D)  $4 an hour; 55 hours a day 
A)  $6 an hour; 60 hours a day 
B)  $6 an hour; 65 hours a day 
C)  $4 an hour; 70 hours a day 
D)  $4 an hour; 55 hours a day

Question 19

The redistribution of income creates the big tradeoff, which is a tradeoff between

Accepted Answer

A)  income and wealth. 
B)  equity and efficiency. 
C)  rich and poor. 
D)  Supplementary Security Income and the Food Stamp program. 
A)  income and wealth. 
B)  equity and efficiency. 
C)  rich and poor. 
D)  Supplementary Security Income and the Food Stamp program.

Question 20

Differences in human capital and discrimination can help explain economic inequality.

Accepted Answer

A) True 
 B)False

-In the figure above, the middle fifth of all households receive what share of all income?

A progressive tax is a tax that taxes income so that the average tax rate increases with income.

Suppose that the income tax in the United States was such that all households had to pay 20 percent of their income to the government as taxes. This tax is an example of

-The above table shows the distribution of wealth and income in Miseria. The Lorenz curve for wealth would

What is meant by the term "assortative mating" and how does it affect the distribution of wealth?

The table shows the distributions of market income and money income in the United States in 2007. -According to the table above, ________ percent of total income is redistributed to the lowest income group.

"The Big Tradeoff" refers to the effect of redistribution on efficiency.

Some economists argue that discrimination based on race and sex cannot lead to persistent wage differentials. What is their argument?

One possible reason the U.S. income distribution has become more unequal is

The distribution of wealth is skewed because more families are below the average level of wealth than are above.

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

Discrimination by customers creates a wage differential between two groups by creating a difference in the two groups' perceived

A firm that discriminates has a nonprejudiced firm and .

-In the figure above, income is most unequally distributed

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the higher productivity of high-skilled workers.

The biggest single factor affecting family income distribution is the

In a Lorenz diagram for income, the line of equality shows

-The table above shows the demand for labor and supply of labor schedules for low-skilled labor. If the labor market is competitive, what is the wage rate of low-skilled labor and what is the quantity of low-skilled labor employed?

The redistribution of income creates the big tradeoff, which is a tradeoff between

Differences in human capital and discrimination can help explain economic inequality.

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Uncertainty and Information

Filters

Exam 19: Economic Inequality

-In the figure above, the middle fifth of all households receive what share of all income?

A progressive tax is a tax that taxes income so that the average tax rate increases with income.

Suppose that the income tax in the United States was such that all households had to pay 20 percent of their income to the government as taxes. This tax is an example of

-The above table shows the distribution of wealth and income in Miseria. The Lorenz curve for wealth would

What is meant by the term "assortative mating" and how does it affect the distribution of wealth?

The table shows the distributions of market income and money income in the United States in 2007. -According to the table above, ________ percent of total income is redistributed to the lowest income group.

"The Big Tradeoff" refers to the effect of redistribution on efficiency.

Some economists argue that discrimination based on race and sex cannot lead to persistent wage differentials. What is their argument?

One possible reason the U.S. income distribution has become more unequal is

The distribution of wealth is skewed because more families are below the average level of wealth than are above.

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

Discrimination by customers creates a wage differential between two groups by creating a difference in the two groups' perceived

A firm that discriminates has ________ a nonprejudiced firm and ________.

-In the figure above, income is most unequally distributed

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the higher productivity of high-skilled workers.

The biggest single factor affecting family income distribution is the

In a Lorenz diagram for income, the line of equality shows

-The table above shows the demand for labor and supply of labor schedules for low-skilled labor. If the labor market is competitive, what is the wage rate of low-skilled labor and what is the quantity of low-skilled labor employed?

The redistribution of income creates the big tradeoff, which is a tradeoff between

Differences in human capital and discrimination can help explain economic inequality.

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Uncertainty and Information

Filters

A firm that discriminates has a nonprejudiced firm and .