Question 1

What have economists who study economic mobility discovered about intergenerational elasticity of earnings between father and son across high-income countries

Accepted Answer

A) There is a small variation in the degree of intergeneration mobility across countries. 
B) The United States exhibit a higher degree of economic mobility than Canada. 
C) Canada is in a group that shows a higher degree of economic mobility. 
D) Higher intergenerational mobility is related to higher intergenerational elasticity of earnings. 
A) There is a small variation in the degree of intergeneration mobility across countries. 
B) The United States exhibit a higher degree of economic mobility than Canada. 
C) Canada is in a group that shows a higher degree of economic mobility. 
D) Higher intergenerational mobility is related to higher intergenerational elasticity of earnings.

Question 2

Assume that the government proposes a negative income tax that calculates taxes owed by the following formula:
Taxes owed = (1/3 × income) - $10,000
Compute the tax that would be owed given each level of income.
a.$120,000
b.$90,000
c.$60,000
d.$30,000
e.$0

Accepted Answer

a.$30,000

Question 3

What is a commonly used gauge of the distribution of income

Accepted Answer

A) income inequality rate 
B) average income rate 
C) poverty rate 
D) social inequality rate 
A) income inequality rate 
B) average income rate 
C) poverty rate 
D) social inequality rate

Question 4

Although no official measure of the poverty line exists in Canada,what is often used to estimate the poverty line by Statistics Canada

Accepted Answer

A) LICO 
B) MASLO 
C) MBM 
D) DMI 
A) LICO 
B) MASLO 
C) MBM 
D) DMI

Question 5

Who is entitled to EI

Accepted Answer

A) workers who quit their jobs for no good reason 
B) workers who are fired for cause 
C) workers who lose their jobs through no fault of their own 
D) workers who drop from full-time to part-time positions 
A) workers who quit their jobs for no good reason 
B) workers who are fired for cause 
C) workers who lose their jobs through no fault of their own 
D) workers who drop from full-time to part-time positions

Question 6

Using demand-supply analysis,show why some economists argue that an effective minimum wage will result in higher unemployment among those groups of workers affected by the minimum wage.

Accepted Answer

Before imposing a minimum wage,the quant

Question 7

In terms of welfare dependency,what can we find in recent empirical evidences

Accepted Answer

A) The longer a family is on welfare, the harder it is for that family to get off welfare. 
B) The best way to deter immigrants is to make legal aliens ineligible for many welfare benefits. 
C) Welfare dependency is embraced by over 80 percent of new welfare recipients. 
D) Legislation designed to limit the time a family can be on welfare will never be passed. 
A) The longer a family is on welfare, the harder it is for that family to get off welfare. 
B) The best way to deter immigrants is to make legal aliens ineligible for many welfare benefits. 
C) Welfare dependency is embraced by over 80 percent of new welfare recipients. 
D) Legislation designed to limit the time a family can be on welfare will never be passed.

Question 8

Figure 20-1
  
-Refer to Figure 20-1.If the government imposes a minimum wage above Wo,which effect is it likely to have

Accepted Answer

A) It will increase employment to a level above Q₀ . 
B) It will reduce employment to a level below Q₀ . 
C) It will provide more income to the working poor. 
D) The market equilibrium wage will be Wo. 
A) It will increase employment to a level above Q₀ . 
B) It will reduce employment to a level below Q₀ . 
C) It will provide more income to the working poor. 
D) The market equilibrium wage will be Wo.

Question 9

The bottom fifth annual family income of Canadian 2011 distribution of income averaged $10,050.

Accepted Answer

A) True 
 B)False

Question 10

When the government taxes income as part of a redistribution program,what happens

Accepted Answer

A) The poor pay higher taxes. 
B) The rich always benefit more than the poor. 
C) Incentives for the poor to work are enhanced. 
D) Incentives to earn income are diminished. 
A) The poor pay higher taxes. 
B) The rich always benefit more than the poor. 
C) Incentives for the poor to work are enhanced. 
D) Incentives to earn income are diminished.

Question 11

Based on data from 2011,approximately what percentage of all income in Canada did the fourth fifth of all families receive

Accepted Answer

A) 24 
B) 43 
C) 51 
D) 78 
A) 24 
B) 43 
C) 51 
D) 78

Question 12

In general,how efficiently and fairly does the invisible hand of the marketplace act to allocate resources

Accepted Answer

A) neither efficiently nor fairly 
B) fairly but not necessarily efficiently 
C) both efficiently and fairly 
D) efficiently but not necessarily fairly 
A) neither efficiently nor fairly 
B) fairly but not necessarily efficiently 
C) both efficiently and fairly 
D) efficiently but not necessarily fairly

Question 13

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

Accepted Answer

A) $39,900 
B) $48,900 
C) $54,900 
D) $57,500 
A) $39,900 
B) $48,900 
C) $54,900 
D) $57,500

Question 14

What is the only qualification to receive government assistance under a negative income tax

Accepted Answer

A) having pre-school children 
B) being enrolled in job training 
C) being a working head-of-household 
D) having a low income 
A) having pre-school children 
B) being enrolled in job training 
C) being a working head-of-household 
D) having a low income

Question 15

Compare and contrast the life cycle hypothesis and the permanent income hypothesis. Is there a basis on which one can judge between these two theories, or are they complementary? What are their respective implications for inequality in the income distribution?

Accepted Answer

The life cycle hypothesis holds that var

Question 16

The utilitarian case for redistributing income is based on the assumption of diminishing marginal utility.

Accepted Answer

A) True 
 B)False

Question 17

Whether or not policymakers should try to make our society more egalitarian is largely a matter of which of the following

Accepted Answer

A) economic efficiency 
B) political philosophy 
C) egalitarian principles 
D) enhanced opportunity 
A) economic efficiency 
B) political philosophy 
C) egalitarian principles 
D) enhanced opportunity

Question 18

What does a person's earnings depend on

Accepted Answer

A) whether or not the economy is experiencing inflation 
B) how well the economy is doing 
C) how much profit her employer is able to make 
D) the supply and demand for her labour 
A) whether or not the economy is experiencing inflation 
B) how well the economy is doing 
C) how much profit her employer is able to make 
D) the supply and demand for her labour

Question 19

What is NOT an aspect of income as included in the economic life cycle

Accepted Answer

A) Incomes are low for young workers. 
B) Incomes rise sharply at retirement. 
C) Incomes rise as the worker gains experience. 
D) Incomes peak at around age 50. 
A) Incomes are low for young workers. 
B) Incomes rise sharply at retirement. 
C) Incomes rise as the worker gains experience. 
D) Incomes peak at around age 50.

Question 20

Why are in-kind transfers politically popular

Accepted Answer

A) They provide food and shelter. 
B) They provide cash with the vouchers. 
C) They allow resale of food stamps for cash, if needed. 
D) They ensure that the poor get what they need most. 
A) They provide food and shelter. 
B) They provide cash with the vouchers. 
C) They allow resale of food stamps for cash, if needed. 
D) They ensure that the poor get what they need most.

Exam 20: Income Inequality and Poverty

What have economists who study economic mobility discovered about intergenerational elasticity of earnings between father and son across high-income countries

Assume that the government proposes a negative income tax that calculates taxes owed by the following formula: Taxes owed = (1/3 × income) - $10,000 Compute the tax that would be owed given each level of income. a.$120,000 b.$90,000 c.$60,000 d.$30,000 e.$0

What is a commonly used gauge of the distribution of income

Although no official measure of the poverty line exists in Canada,what is often used to estimate the poverty line by Statistics Canada

Who is entitled to EI

Using demand-supply analysis,show why some economists argue that an effective minimum wage will result in higher unemployment among those groups of workers affected by the minimum wage.

In terms of welfare dependency,what can we find in recent empirical evidences

Figure 20-1 -Refer to Figure 20-1.If the government imposes a minimum wage above Wo,which effect is it likely to have

The bottom fifth annual family income of Canadian 2011 distribution of income averaged $10,050.

When the government taxes income as part of a redistribution program,what happens

Based on data from 2011,approximately what percentage of all income in Canada did the fourth fifth of all families receive

In general,how efficiently and fairly does the invisible hand of the marketplace act to allocate resources

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

What is the only qualification to receive government assistance under a negative income tax

Compare and contrast the life cycle hypothesis and the permanent income hypothesis. Is there a basis on which one can judge between these two theories, or are they complementary? What are their respective implications for inequality in the income distribution?

The utilitarian case for redistributing income is based on the assumption of diminishing marginal utility.

Whether or not policymakers should try to make our society more egalitarian is largely a matter of which of the following

What does a person's earnings depend on

What is NOT an aspect of income as included in the economic life cycle

Why are in-kind transfers politically popular

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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