Question 1

Exhibit 12-2 Lorenz curve
 
As shown in Exhibit 12-2, 60 percent of families earned a cumulative share of about ____ of income.

Accepted Answer

A)  5 percent 
B)  15 percent 
C)  30 percent 
D)  50 percent 
A)  5 percent 
B)  15 percent 
C)  30 percent 
D)  50 percent C

Question 2

What is the official definition of the poverty line? What are some causes of poverty?

Accepted Answer

The official definition of the poverty line is three times an economy food budget. One of the major causes of poverty includes a lack of education or skills necessary to be productive and in demand. Other factors include discrimination and bad luck.

Question 3

Which of the following statements is correct about Temporary Assistance to Needy Families (TANF)?

Accepted Answer

A)  Families may not receive benefits for longer than 60 months. 
B)  The Federal program determines eligibility and benefit levels with no discretion left to the state. 
C)  Unwed teenage parents receiving benefits must live in public housing. 
D)  Parents with children under age one must work 20 hours per week to receive benefits. 
A)  Families may not receive benefits for longer than 60 months. 
B)  The Federal program determines eligibility and benefit levels with no discretion left to the state. 
C)  Unwed teenage parents receiving benefits must live in public housing. 
D)  Parents with children under age one must work 20 hours per week to receive benefits. A

Question 4

Why are government welfare programs often called entitlement programs?

Accepted Answer

A)  Because every U.S. citizen, regardless of income, is entitled to receive benefits under these programs. 
B)  Because everyone living in the U.S., whether the person is a citizen or not, is entitled to a minimum level of income. 
C)  Because those who fail a means test  are eligible for cash assistance but not in-kind transfers. 
D)  Because people whose income is below a certain level are entitled to government assistance. 
A)  Because every U.S. citizen, regardless of income, is entitled to receive benefits under these programs. 
B)  Because everyone living in the U.S., whether the person is a citizen or not, is entitled to a minimum level of income. 
C)  Because those who fail a means test  are eligible for cash assistance but not in-kind transfers. 
D)  Because people whose income is below a certain level are entitled to government assistance.

Question 5

Exhibit 12-1 Income distribution for three countries
 
Exhibit 12-1 shows the percentage of income received by each population quintile. In Country II we can conclude that the:

Accepted Answer

A)  least-wealthy 40 percent of the population received 20 percent of the economy's income. 
B)  least-wealthy 20 percent of the population received 25 percent of the economy's income. 
C)  richest 20 percent of the population received 20 percent of the economy's income. 
D)  richest 40 percent of the population received 35 percent of the economy's income. 
A)  least-wealthy 40 percent of the population received 20 percent of the economy's income. 
B)  least-wealthy 20 percent of the population received 25 percent of the economy's income. 
C)  richest 20 percent of the population received 20 percent of the economy's income. 
D)  richest 40 percent of the population received 35 percent of the economy's income.

Question 6

Consider a law that limits women's access to certain "dangerous" occupations like coal mining and military combat service. Such a law would likely reduce women's wages because:

Accepted Answer

A)  women would be overqualified for "non-dangerous" jobs. 
B)  labor supply in female-intensive occupations would increase. 
C)  women would be less likely to obtain college degrees. 
D)  comparable worth would no longer exist between men's and women's occupations. 
A)  women would be overqualified for "non-dangerous" jobs. 
B)  labor supply in female-intensive occupations would increase. 
C)  women would be less likely to obtain college degrees. 
D)  comparable worth would no longer exist between men's and women's occupations.

Question 7

A requirement that a family's income not exceed a certain level to be eligible for public assistance is called

Accepted Answer

A)  a welfare constraint. 
B)  an entitlement test. 
C)  a means test. 
D)  an earned income tax credit. 
A)  a welfare constraint. 
B)  an entitlement test. 
C)  a means test. 
D)  an earned income tax credit.

Question 8

Which of the following programs are in-kind assistance to fight poverty in the United States?

Accepted Answer

A)  social security 
B)  Medicaid. 
C)  unemployment benefits 
D)  Temporary Assistance to Needy Families (TANF). 
A)  social security 
B)  Medicaid. 
C)  unemployment benefits 
D)  Temporary Assistance to Needy Families (TANF).

Question 9

Exhibit 12-1 Income distribution for three countries
 
Exhibit 12-1 shows the percentage of income received by each population quintile. From this chart we can conclude:

Accepted Answer

A)  Country I has the most unequal income distribution. 
B)  Country III has a more equal income distribution than Country II. 
C)  Country II has the most unequal income distribution. 
D)  Country II has the most equal income distribution. 
A)  Country I has the most unequal income distribution. 
B)  Country III has a more equal income distribution than Country II. 
C)  Country II has the most unequal income distribution. 
D)  Country II has the most equal income distribution.

Question 10

Describe the advantages that a negative income tax has over other programs that have the same purpose.

Accepted Answer

First, a negative income tax is less cos

Question 11

Describe the comparable worth controversy?

Accepted Answer

Although a comparable worth pay system m

Question 12

Exhibit 12-9 Negative Income Tax
 
​
As shown in Exhibit 12-9, a family of four does not pay income taxes at:

Accepted Answer

A)  an income of $25,000. 
B)  any income between zero and $20,000. 
C)  all levels of income. 
D)  any income above $20,000. 
A)  an income of $25,000. 
B)  any income between zero and $20,000. 
C)  all levels of income. 
D)  any income above $20,000.

Question 13

Which of the following is a result of discrimination?

Accepted Answer

A)  Two groups of workers earning different wages. 
B)  Two groups of workers paid the same wage, but proportionally fewer of one group are employed. 
C)  Equal pay and equal employment opportunities for two groups of workers with different productivities. 
D)  No workers from a particular group are employed. 
A)  Two groups of workers earning different wages. 
B)  Two groups of workers paid the same wage, but proportionally fewer of one group are employed. 
C)  Equal pay and equal employment opportunities for two groups of workers with different productivities. 
D)  No workers from a particular group are employed.

Question 14

The incentive to work is an ingredient of the negative income tax because:

Accepted Answer

A)  if families do work, they will be eliminated from the program. 
B)  if families don't work, they will be eliminated from the program. 
C)  the more income earned in the workplace, the higher the family's after-tax income. 
D)  the more income earned in the workplace, the higher the payment from the government. 
A)  if families do work, they will be eliminated from the program. 
B)  if families don't work, they will be eliminated from the program. 
C)  the more income earned in the workplace, the higher the family's after-tax income. 
D)  the more income earned in the workplace, the higher the payment from the government.

Question 15

Exhibit 12-2 Lorenz curve
 
As shown in Exhibit 12-2, the distance between points B and D means that 60 percent of families earn ____ less of total income than required for perfect equality.

Accepted Answer

A)  30 percent 
B)  50 percent 
C)  60 percent 
D)  90 percent 
A)  30 percent 
B)  50 percent 
C)  60 percent 
D)  90 percent

Question 16

Sort the following into cash transfer programs and in-kind transfers: 
 - social security
 - SNAP
 - TANF
 - Medicare
 - Medicaid
 - housing assistance
 - earned income tax credit (EITC)

Accepted Answer

A)  cash transfers: social security, SNAP, TANF, and Medicare; in-kind transfers: Medicaid, housing assistance, EITC 
B)  cash tranfers: social security, housing assistance, Medicare, and Medicaid; in-kind transfers: EITC, SNAP, TANF 
C)  cash transfers: social security, EITC, TANF; in-kind transfers: Medicare, Medicaid, SNAP, housing assistance 
D)  cash transfers: EITC, TANF, SNAP; in-kind transfers: social security, Medicare, Medicaid, housing assistance 
A)  cash transfers: social security, SNAP, TANF, and Medicare; in-kind transfers: Medicaid, housing assistance, EITC 
B)  cash tranfers: social security, housing assistance, Medicare, and Medicaid; in-kind transfers: EITC, SNAP, TANF 
C)  cash transfers: social security, EITC, TANF; in-kind transfers: Medicare, Medicaid, SNAP, housing assistance 
D)  cash transfers: EITC, TANF, SNAP; in-kind transfers: social security, Medicare, Medicaid, housing assistance

Question 17

Exhibit 12-7 Negative income tax
 
As shown in Exhibit 12-7, a family of four pays income taxes at:

Accepted Answer

A)  an income of $5,000. 
B)  any income between zero and $40,000. 
C)  all levels of income. 
D)  any income above $40,000. 
A)  an income of $5,000. 
B)  any income between zero and $40,000. 
C)  all levels of income. 
D)  any income above $40,000.

Question 18

Some people believe that employees should be paid the same wages when their jobs, although different, require similar levels of education, training, experience, and responsibility. This principle is known as:

Accepted Answer

A)  the equal-pay-for-equal work doctrine. 
B)  Lorenz equivalence. 
C)  marginal productivity theory. 
D)  comparable worth. 
A)  the equal-pay-for-equal work doctrine. 
B)  Lorenz equivalence. 
C)  marginal productivity theory. 
D)  comparable worth.

Question 19

If official U.S. poverty statistics included in-kind transfer payments the:

Accepted Answer

A)  poverty rate would be close to zero. 
B)  poverty rate would be lower. 
C)  government deficit would be lower. 
D)  top 10 percent of those in the income distribution would be wealthier. 
A)  poverty rate would be close to zero. 
B)  poverty rate would be lower. 
C)  government deficit would be lower. 
D)  top 10 percent of those in the income distribution would be wealthier.

Question 20

Which of the following might decrease the supply curve of labor?

Accepted Answer

A)  Elimination of discrimination against blacks. 
B)  Elimination of discrimination against females. 
C)  Easing licensing requirements. 
D)  Increasing discrimination against any group. 
A)  Elimination of discrimination against blacks. 
B)  Elimination of discrimination against females. 
C)  Easing licensing requirements. 
D)  Increasing discrimination against any group.

Exam 12: Income Distribution Poverty and Discrimination

Exhibit 12-2 Lorenz curve As shown in Exhibit 12-2, 60 percent of families earned a cumulative share of about ____ of income.

What is the official definition of the poverty line? What are some causes of poverty?

Which of the following statements is correct about Temporary Assistance to Needy Families (TANF)?

Why are government welfare programs often called entitlement programs?

Exhibit 12-1 Income distribution for three countries Exhibit 12-1 shows the percentage of income received by each population quintile. In Country II we can conclude that the:

Consider a law that limits women's access to certain "dangerous" occupations like coal mining and military combat service. Such a law would likely reduce women's wages because:

A requirement that a family's income not exceed a certain level to be eligible for public assistance is called

Which of the following programs are in-kind assistance to fight poverty in the United States?

Exhibit 12-1 Income distribution for three countries Exhibit 12-1 shows the percentage of income received by each population quintile. From this chart we can conclude:

Describe the advantages that a negative income tax has over other programs that have the same purpose.

Describe the comparable worth controversy?

Exhibit 12-9 Negative Income Tax ​ As shown in Exhibit 12-9, a family of four does not pay income taxes at:

Which of the following is a result of discrimination?

The incentive to work is an ingredient of the negative income tax because:

Exhibit 12-2 Lorenz curve As shown in Exhibit 12-2, the distance between points B and D means that 60 percent of families earn ____ less of total income than required for perfect equality.

Sort the following into cash transfer programs and in-kind transfers: - social security - SNAP - TANF - Medicare - Medicaid - housing assistance - earned income tax credit (EITC)

Exhibit 12-7 Negative income tax As shown in Exhibit 12-7, a family of four pays income taxes at:

Some people believe that employees should be paid the same wages when their jobs, although different, require similar levels of education, training, experience, and responsibility. This principle is known as:

If official U.S. poverty statistics included in-kind transfer payments the:

Which of the following might decrease the supply curve of labor?

Introducing the Economic Way of Thinking

Production Possibilities Opportunity Cost and Economic Growth

Market Demand and Supply

Markets in Action

Price Elasticity of Demand and Supply

Consumer Choice Theory

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets

Antitrust and Regulation

Environmental Economics

Gross Domestic Product

Business Cycles and Unemployment

Inflation

The Keynesian Model

The Keynesian Model in Action

Aggregate Demand and Supply

Fiscal Policy

The Public Sector

Federal Deficits Surpluses and the National Debt

Money and the Federal Reserve System

Money Creation

Monetary Policy

The Phillips Curve and Expectations Theory

International Trade and Finance

Economies in Transition

Growth and the Less Developed Countries

Understanding Direct and Inverse Relationships between Variables

Filters

Exhibit 12-9 Negative Income Tax As shown in Exhibit 12-9, a family of four does not pay income taxes at: