Question 1

What example does Robert Nozick use to criticize John Rawls' concept of justice

Accepted Answer

A) income redistribution is like an insurance policy 
B) the grade distribution in an economics class 
C) the distribution of capital in society 
D) differences in political ideology among different parties 
A) income redistribution is like an insurance policy 
B) the grade distribution in an economics class 
C) the distribution of capital in society 
D) differences in political ideology among different parties

Question 2

Which function must a measurement instrument of the distribution of income in our society perform

Accepted Answer

A) It must explain inequality. 
B) It must explain why people live below poverty. 
C) It must tell how many people live in poverty. 
D) It must explain why the income gap is large and growing. 
A) It must explain inequality. 
B) It must explain why people live below poverty. 
C) It must tell how many people live in poverty. 
D) It must explain why the income gap is large and growing.

Question 3

When measuring income distribution,what is the income share of the top fifth of all families

Accepted Answer

A) over 50 percent 
B) about 30 times the income of the bottom fifth 
C) around 25 percent 
D) about the same as the income of the top 5 percent 
A) over 50 percent 
B) about 30 times the income of the bottom fifth 
C) around 25 percent 
D) about the same as the income of the top 5 percent

Question 4

Table 20-1
The poverty line in the country of Equalia is $10,000. The distribution of income for Equalia is as follows:

-Refer to Table 20-1.What is the poverty rate in Equalia

Accepted Answer

A) 11.1 percent 
B) 16.7 percent 
C) 30.0 percent 
D) 55.5 percent 
A) 11.1 percent 
B) 16.7 percent 
C) 30.0 percent 
D) 55.5 percent

Question 5

As a general rule,what do antipoverty programs,as a whole,do

Accepted Answer

A) They encourage saving among recipient groups. 
B) They impose a very low marginal tax rate on income. 
C) They are only made available to those with no other source of income. 
D) They impose disincentives to work. 
A) They encourage saving among recipient groups. 
B) They impose a very low marginal tax rate on income. 
C) They are only made available to those with no other source of income. 
D) They impose disincentives to work.

Question 6

Based on Canadian income data from 2011,what was the second fifth of all families' average income after transfers and taxes

Accepted Answer

A) $21,000 
B) $26,000 
C) $35,900 
D) $38,000 
A) $21,000 
B) $26,000 
C) $35,900 
D) $38,000

Question 7

Suppose that income is assumed to have constant marginal utility.From a utilitarian perspective,which conclusion would apply

Accepted Answer

A) Some income redistribution from rich to poor would increase social welfare. 
B) Some income redistribution from poor to rich would increase social welfare. 
C) Any income redistribution would probably reduce social welfare. 
D) Any income redistribution would probably increase social welfare. 
A) Some income redistribution from rich to poor would increase social welfare. 
B) Some income redistribution from poor to rich would increase social welfare. 
C) Any income redistribution would probably reduce social welfare. 
D) Any income redistribution would probably increase social welfare.

Question 8

What can we say about measures of poverty that fail to account for the value of in-kind transfers

Accepted Answer

A) They understate the actual poverty rate. 
B) They have little effect on the validity of reported poverty rates. 
C) They are generally more reliable in accounting for annual variation in actual poverty rates. 
D) They overstate the actual poverty rate. 
A) They understate the actual poverty rate. 
B) They have little effect on the validity of reported poverty rates. 
C) They are generally more reliable in accounting for annual variation in actual poverty rates. 
D) They overstate the actual poverty rate.

Question 9

Based on Canadian income data from 2011,what was the fourth fifth of all families' average income after transfers and taxes

Accepted Answer

A) $58,300 
B) $73,255 
C) $89,100 
D) $95,000 
A) $58,300 
B) $73,255 
C) $89,100 
D) $95,000

Question 10

Which outcome do government programs that take money from high-income people to give it to low-income people typically achieve

Accepted Answer

A) They improve economic efficiency by reducing poverty. 
B) They reduce economic efficiency because they distort incentives. 
C) They improve economic efficiency by redistributing income. 
D) They reduce economic efficiency because they reduce equity. 
A) They improve economic efficiency by reducing poverty. 
B) They reduce economic efficiency because they distort incentives. 
C) They improve economic efficiency by redistributing income. 
D) They reduce economic efficiency because they reduce equity.

Question 11

According to the Human Resources and Skills Development Canada measure of poverty,what was Canada's poverty rate in 2007

Accepted Answer

A) 10.1 percent 
B) 11.6 percent 
C) 13.7 percent 
D) 14.9 percent 
A) 10.1 percent 
B) 11.6 percent 
C) 13.7 percent 
D) 14.9 percent

Question 12

The concept of diminishing marginal utility is embodied in the utilitarian rationale for which of the following

Accepted Answer

A) trickle-down effects 
B) enhancing market efficiency 
C) redistributing income 
D) maintaining the status quo income distribution 
A) trickle-down effects 
B) enhancing market efficiency 
C) redistributing income 
D) maintaining the status quo income distribution

Question 13

Explain the concept of diminishing marginal utility and describe the role that it plays in the utilitarian argument for redistribution of income.

Accepted Answer

In this context,diminishing marginal uti

Question 14

Suppose that income is assumed to have increasing marginal utility.From a utilitarian perspective,what can be concluded

Accepted Answer

A) Some income redistribution from rich to poor would increase social welfare. 
B) Some income redistribution from poor to rich would increase social welfare. 
C) Any income redistribution would probably reduce social welfare. 
D) Any income redistribution would probably increase social welfare. 
A) Some income redistribution from rich to poor would increase social welfare. 
B) Some income redistribution from poor to rich would increase social welfare. 
C) Any income redistribution would probably reduce social welfare. 
D) Any income redistribution would probably increase social welfare.

Question 15

If income were equally distributed among households,what would be the result

Accepted Answer

A) The household's relative share of income would increase. 
B) The household's relative share of income would decline. 
C) Fifty percent of the households would receive exactly 50 percent of the income. 
D) All households would become rich. 
A) The household's relative share of income would increase. 
B) The household's relative share of income would decline. 
C) Fifty percent of the households would receive exactly 50 percent of the income. 
D) All households would become rich.

Question 16

Many people have been critical of statistics that are used to characterize income inequality on the grounds that as long as the average income of the poor is increasing,their position relative to the rich should not matter.Evaluate this critique.

Accepted Answer

Advocates of relative measures argue tha

Question 17

What assumption is the utilitarian case for redistributing income based on

Accepted Answer

A) collective consensus 
B) a notion of fairness engendered by equality 
C) diminishing marginal utility 
D) rising marginal utility 
A) collective consensus 
B) a notion of fairness engendered by equality 
C) diminishing marginal utility 
D) rising marginal utility

Question 18

What is NOT an example of in-kind transfers

Accepted Answer

A) food stamps 
B) healthcare 
C) the Earned Income Tax Credit 
D) housing vouchers 
A) food stamps 
B) healthcare 
C) the Earned Income Tax Credit 
D) housing vouchers

Question 19

According to the liberalism,what will result behind a "veil of ignorance"

Accepted Answer

A) Justice can never be agreed upon. 
B) No one would be concerned about possibly being on the bottom of the income distribution. 
C) Everyone would agree to "just" rules to reallocate income. 
D) Justice is a matter of political philosophy. 
A) Justice can never be agreed upon. 
B) No one would be concerned about possibly being on the bottom of the income distribution. 
C) Everyone would agree to "just" rules to reallocate income. 
D) Justice is a matter of political philosophy.

Question 20

What is the political philosophy that believes in focusing on evaluating the process of determining the distribution of income rather than on the outcomes

Accepted Answer

A) utilitarianism 
B) liberalism 
C) libertarianism 
D) conservatism 
A) utilitarianism 
B) liberalism 
C) libertarianism 
D) conservatism

Exam 20: Income Inequality and Poverty

What example does Robert Nozick use to criticize John Rawls' concept of justice

Which function must a measurement instrument of the distribution of income in our society perform

When measuring income distribution,what is the income share of the top fifth of all families

Table 20-1 The poverty line in the country of Equalia is $10,000. The distribution of income for Equalia is as follows: -Refer to Table 20-1.What is the poverty rate in Equalia

As a general rule,what do antipoverty programs,as a whole,do

Based on Canadian income data from 2011,what was the second fifth of all families' average income after transfers and taxes

Suppose that income is assumed to have constant marginal utility.From a utilitarian perspective,which conclusion would apply

What can we say about measures of poverty that fail to account for the value of in-kind transfers

Based on Canadian income data from 2011,what was the fourth fifth of all families' average income after transfers and taxes

Which outcome do government programs that take money from high-income people to give it to low-income people typically achieve

According to the Human Resources and Skills Development Canada measure of poverty,what was Canada's poverty rate in 2007

The concept of diminishing marginal utility is embodied in the utilitarian rationale for which of the following

Explain the concept of diminishing marginal utility and describe the role that it plays in the utilitarian argument for redistribution of income.

Suppose that income is assumed to have increasing marginal utility.From a utilitarian perspective,what can be concluded

If income were equally distributed among households,what would be the result

Many people have been critical of statistics that are used to characterize income inequality on the grounds that as long as the average income of the poor is increasing,their position relative to the rich should not matter.Evaluate this critique.

What assumption is the utilitarian case for redistributing income based on

What is NOT an example of in-kind transfers

According to the liberalism,what will result behind a "veil of ignorance"

What is the political philosophy that believes in focusing on evaluating the process of determining the distribution of income rather than on the outcomes

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, demand, and Government Policies

Consumers, producers, and the Efficiency of Markets

Application: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

The Theory of Consumer Choice

Frontiers of Microeconomics

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