Question 1

Differences in the amounts and quality of education and training

Accepted Answer

A) combine with differences in mental, physical, and aesthetic talents to produce income inequality. 
B) explain none of the income inequality in the United States. 
C) explain nearly all the income inequality in the United States. 
D) have lessened in the United States in the past decade, sharply reducing income inequality. 
A) combine with differences in mental, physical, and aesthetic talents to produce income inequality. 
B) explain none of the income inequality in the United States. 
C) explain nearly all the income inequality in the United States. 
D) have lessened in the United States in the past decade, sharply reducing income inequality.

Question 2

Which of the following is not a basic difference between Medicare and Medicaid?

Accepted Answer

A) Medicare is financed by a payroll tax, while Medicaid is financed by general tax revenues. 
B) Medicare is a federal program, while Medicaid is a state-government program. 
C) Medicare is mostly based on age, while Medicaid is mostly based on income. 
D) Medicare is a social insurance program, while Medicaid is a public assistance program. 
A) Medicare is financed by a payroll tax, while Medicaid is financed by general tax revenues. 
B) Medicare is a federal program, while Medicaid is a state-government program. 
C) Medicare is mostly based on age, while Medicaid is mostly based on income. 
D) Medicare is a social insurance program, while Medicaid is a public assistance program.

Question 3

In the United States, the lifetime distribution of income is more equal than the annual distribution. This statement is

Accepted Answer

A) true because the rich have gotten richer and the poor have gotten poorer. 
B) true because there is considerable income mobility over time. 
C) false because people tend to stay in the same income quintile over extended periods of time. 
D) false because the rich have gotten richer and the poor have gotten poorer. 
A) true because the rich have gotten richer and the poor have gotten poorer. 
B) true because there is considerable income mobility over time. 
C) false because people tend to stay in the same income quintile over extended periods of time. 
D) false because the rich have gotten richer and the poor have gotten poorer.

Question 4

In 2017, the official poverty line for a household of four in the United States was

Accepted Answer

A) $24,858. 
B) $32,753. 
C) $12,488. 
D) $26,803. 
A) $24,858. 
B) $32,753. 
C) $12,488. 
D) $26,803.

Question 5

A major criticism of the welfare system that led to reforms in the mid-1990s is that welfare payments

Accepted Answer

A) encourage overuse of the medical system. 
B) create dependency on government programs. 
C) give strong incentives for people to change jobs. 
D) fail to provide a minimum income for young children. 
A) encourage overuse of the medical system. 
B) create dependency on government programs. 
C) give strong incentives for people to change jobs. 
D) fail to provide a minimum income for young children.

Question 6

Gomez argues that we need to increase the nation's output. Chang contends that our top priority should be a more equal distribution of income and output. It can be correctly stated that these two goals are

Accepted Answer

A) essentially unrelated. 
B) complementary because the realization of one will promote fulfillment of the other. 
C) at least partially competing because the redistribution of income might impair incentives to work and produce. 
D) complementary because a more equal distribution of income always promotes economic growth. 
A) essentially unrelated. 
B) complementary because the realization of one will promote fulfillment of the other. 
C) at least partially competing because the redistribution of income might impair incentives to work and produce. 
D) complementary because a more equal distribution of income always promotes economic growth.

Question 7

The judging of an individual on the basis of the average characteristics of the group to which the individual belongs rather than the individual's characteristics is

Accepted Answer

A) statistical discrimination. 
B) reverse discrimination. 
C) human capital discrimination. 
D) wage discrimination. 
A) statistical discrimination. 
B) reverse discrimination. 
C) human capital discrimination. 
D) wage discrimination.

Question 8

The Temporary Assistance for Needy Families (TANF)program that replaced the old Aid for Families with Dependent Children welfare program succeeded in reducing the number of welfare recipients and increasing the employment rate among single mothers until the 2007-2008 recession hit.

Accepted Answer

A) True 
 B)False

Question 9

The Temporary Assistance for Needy Families (TANF)program expanded welfare benefits and has no limit on the number of years for receiving welfare benefits.

Accepted Answer

A) True 
 B)False

Question 10

Income mobility

Accepted Answer

A) contributes to greater wealth inequality in the United States. 
B) is less in the United States than in most developing nations. 
C) is the movement of individuals and households from one income quintile to another over time. 
D) makes lifetime income inequality among income receivers in the United States greater than income inequality in any single year. 
A) contributes to greater wealth inequality in the United States. 
B) is less in the United States than in most developing nations. 
C) is the movement of individuals and households from one income quintile to another over time. 
D) makes lifetime income inequality among income receivers in the United States greater than income inequality in any single year.

Question 11

In 2017, an unattached individual would be defined as living in poverty if his or her income was less than

Accepted Answer

A) $5,105. 
B) $12,488. 
C) $24,858. 
D) $32,753. 
A) $5,105. 
B) $12,488. 
C) $24,858. 
D) $32,753.

Question 12

The term "growing income inequality" implies that the

Accepted Answer

A) poor are getting poorer in both a relative and an absolute sense. 
B) Lorenz curve is shifting toward the diagonal. 
C) diagonal is shifting toward the Lorenz curve. 
D) upper quintiles of income receivers are getting relatively more of the total income than before and the lower quintiles are getting relatively less. 
A) poor are getting poorer in both a relative and an absolute sense. 
B) Lorenz curve is shifting toward the diagonal. 
C) diagonal is shifting toward the Lorenz curve. 
D) upper quintiles of income receivers are getting relatively more of the total income than before and the lower quintiles are getting relatively less.

Question 13

For an employer biased against African Americans, the discrimination coefficient d

Accepted Answer

A) will decrease if the employer becomes more prejudiced against African Americans. 
B) must equal the actual ratio of African-American to white wage rates. 
C) measures the amount an employer is willing to pay to hire a white over hiring an African-American worker. 
D) varies inversely with the actual African-American to white wage ratio. 
A) will decrease if the employer becomes more prejudiced against African Americans. 
B) must equal the actual ratio of African-American to white wage rates. 
C) measures the amount an employer is willing to pay to hire a white over hiring an African-American worker. 
D) varies inversely with the actual African-American to white wage ratio.

Question 14

Each of the following has contributed to growing income inequality in the United States since 1980 except

Accepted Answer

A) the decline in unionism. 
B) greater demand for highly skilled workers. 
C) stronger international competition from imports. 
D) government transfers. 
A) the decline in unionism. 
B) greater demand for highly skilled workers. 
C) stronger international competition from imports. 
D) government transfers.

Question 15

Income

Accepted Answer

A) is a stock concept. 
B) consists of accumulated assets. 
C) is a flow concept. 
D) consists of wages only. 
A) is a stock concept. 
B) consists of accumulated assets. 
C) is a flow concept. 
D) consists of wages only.

Question 16

The empirical data indicate that the tax system and the transfer programs of the government

Accepted Answer

A) increase the degree of inequality in the distribution of income. 
B) make no change in the degree of inequality in the distribution of income. 
C) reduce the degree of inequality in the distribution of income. 
D) affect the distribution of wealth, not income. 
A) increase the degree of inequality in the distribution of income. 
B) make no change in the degree of inequality in the distribution of income. 
C) reduce the degree of inequality in the distribution of income. 
D) affect the distribution of wealth, not income.

Question 17

The entrance of large numbers of "baby boomers" into the labor force in the 1970s and 1980s

Accepted Answer

A) caused substantial reductions in permanent unemployment. 
B) lessened income inequality. 
C) increased income inequality. 
D) had no impact on income inequality. 
A) caused substantial reductions in permanent unemployment. 
B) lessened income inequality. 
C) increased income inequality. 
D) had no impact on income inequality.

Question 18

Suppose the members of population A, consisting of Al, Bob, Curt, Doris, and Ellie, receive annual incomes of $5,000, $2,500, $1,250, $750, and $500, respectively. The members of population B, consisting of Fred, George, Holly, Irma, and Joan, receive incomes of $4,000, $3,000, $1,250, $950, and $800, respectively. We

Accepted Answer

A) can say that the income of population B is less equally distributed than that of population A. 
B) can say that the income of population B is more equally distributed than that of population A. 
C) cannot make a meaningful comparison of the income distributions of populations A and B. 
D) can say that the poorest quintile of population B receives 12 percent of total income. 
A) can say that the income of population B is less equally distributed than that of population A. 
B) can say that the income of population B is more equally distributed than that of population A. 
C) cannot make a meaningful comparison of the income distributions of populations A and B. 
D) can say that the poorest quintile of population B receives 12 percent of total income.

Question 19

Which of the following groups has the lowest poverty rate?

Accepted Answer

A) married-couple families 
B) whites 
C) foreign-born (not citizens) 
D) Asians 
A) married-couple families 
B) whites 
C) foreign-born (not citizens) 
D) Asians

Question 20

The crowding model of occupational segregation predicts that domestic output will increase if occupational segregation is ended.

Accepted Answer

A) True 
 B)False

Exam 23: Income Inequality, Poverty, and Discrimination

Differences in the amounts and quality of education and training

Which of the following is not a basic difference between Medicare and Medicaid?

In the United States, the lifetime distribution of income is more equal than the annual distribution. This statement is

In 2017, the official poverty line for a household of four in the United States was

A major criticism of the welfare system that led to reforms in the mid-1990s is that welfare payments

Gomez argues that we need to increase the nation's output. Chang contends that our top priority should be a more equal distribution of income and output. It can be correctly stated that these two goals are

The judging of an individual on the basis of the average characteristics of the group to which the individual belongs rather than the individual's characteristics is

The Temporary Assistance for Needy Families (TANF)program that replaced the old Aid for Families with Dependent Children welfare program succeeded in reducing the number of welfare recipients and increasing the employment rate among single mothers until the 2007-2008 recession hit.

The Temporary Assistance for Needy Families (TANF)program expanded welfare benefits and has no limit on the number of years for receiving welfare benefits.

Income mobility

In 2017, an unattached individual would be defined as living in poverty if his or her income was less than

The term "growing income inequality" implies that the

For an employer biased against African Americans, the discrimination coefficient d

Each of the following has contributed to growing income inequality in the United States since 1980 except

Income

The empirical data indicate that the tax system and the transfer programs of the government

The entrance of large numbers of "baby boomers" into the labor force in the 1970s and 1980s

Which of the following groups has the lowest poverty rate?

The crowding model of occupational segregation predicts that domestic output will increase if occupational segregation is ended.

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Costs of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Technology, RD, and Efficiency

The Demand for Resources

Wage Determination

Rent, Interest, and Profit

Natural Resource and Energy Economics

Public Finance: Expenditures and Taxes

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Health Care

Immigration

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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