Question 1

Table 19.4.2
  
-Refer to Table 19.4.2. The table shows three tax payment schemes. Which tax payment plan reduces inequality?

Accepted Answer

A) Plan A 
B) Plan A and Plan C 
C) Plan C 
D) Plan B 
E) Plan A, Plan B, and Plan C 
A) Plan A 
B) Plan A and Plan C 
C) Plan C 
D) Plan B 
E) Plan A, Plan B, and Plan C

Question 2

Since 1976 the Canadian Gini ratio has

Accepted Answer

A) decreased and then increased. 
B) decreased. 
C) increased. 
D) been approximately equal to zero. 
E) increased and then decreased. 
A) decreased and then increased. 
B) decreased. 
C) increased. 
D) been approximately equal to zero. 
E) increased and then decreased.

Question 3

Economists who have compared the incomes of never-married men and never-married women have found that with equal amounts of human capital

Accepted Answer

A) men earn significantly more than women. 
B) women earn significantly more than men. 
C) the wages of the two groups are equal. 
D) men specialize more in home production. 
E) women tend to undertake more education. 
A) men earn significantly more than women. 
B) women earn significantly more than men. 
C) the wages of the two groups are equal. 
D) men specialize more in home production. 
E) women tend to undertake more education.

Question 4

If the supply of labour curve is upward sloping but not vertical, and if the value of marginal product of labour increases,

Accepted Answer

A) the supply of labour increases. 
B) the wage rate rises. 
C) the marginal cost of production increases. 
D) the exploitation of workers decreases. 
E) employment is unchanged. 
A) the supply of labour increases. 
B) the wage rate rises. 
C) the marginal cost of production increases. 
D) the exploitation of workers decreases. 
E) employment is unchanged.

Question 5

Use the figure below to answer the following questions.
   
Figure 19.1.2
-Consider the Lorenz curves in Figure 19.1.2. Which point indicates that the richest 20 percent of families earn 60 percent of the income?

Accepted Answer

A) a 
B) b 
C) c 
D) d 
E) the origin 
A) a 
B) b 
C) c 
D) d 
E) the origin

Question 6

Use the figure below to answer the following questions.
   
Figure 19.1.1
-Refer to Figure 19.1.1. The middle 20 percent of households receive what share of total income?

Accepted Answer

A) 20 percent 
B) 25 percent 
C) 35 percent 
D) 15 percent 
E) 60 percent 
A) 20 percent 
B) 25 percent 
C) 35 percent 
D) 15 percent 
E) 60 percent

Question 7

Market income equals

Accepted Answer

A) the wages, interest, rent, and profit earned in factor markets after paying income taxes. 
B) the wages, interest, and profit earned in factor markets before paying income taxes. 
C) the wages, interest, and rent earned in factor markets before paying income taxes. 
D) the wages, interest, rent, and profit earned in factor markets before paying income taxes. 
E) the wages, rent, and profit earned in factor markets before paying income taxes. 
A) the wages, interest, rent, and profit earned in factor markets after paying income taxes. 
B) the wages, interest, and profit earned in factor markets before paying income taxes. 
C) the wages, interest, and rent earned in factor markets before paying income taxes. 
D) the wages, interest, rent, and profit earned in factor markets before paying income taxes. 
E) the wages, rent, and profit earned in factor markets before paying income taxes.

Question 8

The Gini coefficient for a perfectly equal distribution of income is

Accepted Answer

A) equal to zero. 
B) equal to 1. 
C) equal to 100. 
D) equal to infinity. 
E) negative. 
A) equal to zero. 
B) equal to 1. 
C) equal to 100. 
D) equal to infinity. 
E) negative.

Question 9

Assortative mating means that

Accepted Answer

A) poor men tend to marry rich women. 
B) people tend to marry within their own socioeconomic class. 
C) people tend to marry above their own socioeconomic class. 
D) same sex marriages occur because "like attracts like." 
E) people with different values will marry. 
A) poor men tend to marry rich women. 
B) people tend to marry within their own socioeconomic class. 
C) people tend to marry above their own socioeconomic class. 
D) same sex marriages occur because "like attracts like." 
E) people with different values will marry.

Question 10

Use the information below to answer the following questions.
Fact 19.4.1 Income Gap Growing
In 2009, people in the highest quintile had 24.6 times as much market income as those in the lowest quintile, but after taxes and transfers the people in the highest quintile had 9.1 times as much income as those in the lowest quintile. In 1989, the people in the highest quintile had 7.2 times more income after taxes and transfers than those in the lowest quintile. In 1990, 82.9 percent of the unemployed received unemployment benefits. In 2009, 47.8 percent of the unemployed received unemployment benefits.
Source: Conference Board of Canada, July 13, 2011
-Refer to Fact 19.4.1. This news clip implies that

Accepted Answer

A) in 2009, the highest quintile gave 15.5 percent of its income to the lowest quintile. 
B) Canada should increase income redistribution. 
C) income redistribution in 2009 leads to more income equality than in 1989. 
D) income redistribution in 2009 leads to less income equality than in 1989. 
E) income redistribution in 2009 leads to the same income equality in 1989. 
A) in 2009, the highest quintile gave 15.5 percent of its income to the lowest quintile. 
B) Canada should increase income redistribution. 
C) income redistribution in 2009 leads to more income equality than in 1989. 
D) income redistribution in 2009 leads to less income equality than in 1989. 
E) income redistribution in 2009 leads to the same income equality in 1989.

Question 11

Information technologies are ________ for low-skilled labour and ________ for high-skilled labour.

Accepted Answer

A) substitutes; complements 
B) substitutes; substitutes 
C) complements; complements 
D) complements; substitutes 
E) normal goods; inferior goods 
A) substitutes; complements 
B) substitutes; substitutes 
C) complements; complements 
D) complements; substitutes 
E) normal goods; inferior goods

Question 12

If the average tax rate decreases as income increases, the income tax is

Accepted Answer

A) progressive. 
B) proportional. 
C) negative. 
D) regressive. 
E) redistributive. 
A) progressive. 
B) proportional. 
C) negative. 
D) regressive. 
E) redistributive.

Question 13

The distribution of annual income

Accepted Answer

A) understates the degree of inequality because it does not take into account the family's stage in its life cycle. 
B) understates the degree of inequality because it does not take into account the distribution of human capital. 
C) overstates the degree of inequality because it does not take into account the family's stage in its life cycle. 
D) overstates the degree of inequality because it does not take into account the distribution of human capital. 
E) is an accurate measure of the degree of inequality. 
A) understates the degree of inequality because it does not take into account the family's stage in its life cycle. 
B) understates the degree of inequality because it does not take into account the distribution of human capital. 
C) overstates the degree of inequality because it does not take into account the family's stage in its life cycle. 
D) overstates the degree of inequality because it does not take into account the distribution of human capital. 
E) is an accurate measure of the degree of inequality.

Question 14

Discrimination results in ________ compared to a situation with no discrimination.

Accepted Answer

A) a lower wage rate but no change in the number employed 
B) a higher numbered employed and a lower wage rate 
C) a smaller number employed but no change in the wage rate 
D) a smaller number employed and a lower wage rate 
E) none of the above 
A) a lower wage rate but no change in the number employed 
B) a higher numbered employed and a lower wage rate 
C) a smaller number employed but no change in the wage rate 
D) a smaller number employed and a lower wage rate 
E) none of the above

Question 15

If discrimination takes the form of consumers discriminating against a group of workers, the effect on this group of workers will be to shift their

Accepted Answer

A) value of marginal product curve rightward and increase their wage rate. 
B) value of marginal product curve leftward and decrease their wage rate. 
C) value of marginal product curve rightward and decrease their wage rate. 
D) supply of labour curve leftward and increase their wage rate. 
E) supply of labour curve rightward and decrease their wage rate. 
A) value of marginal product curve rightward and increase their wage rate. 
B) value of marginal product curve leftward and decrease their wage rate. 
C) value of marginal product curve rightward and decrease their wage rate. 
D) supply of labour curve leftward and increase their wage rate. 
E) supply of labour curve rightward and decrease their wage rate.

Question 16

The distribution of world income is ________ the distribution of Canadian income.

Accepted Answer

A) more equal than 
B) equal to 
C) not comparable to 
D) equal to the distribution of Canadian wealth and more equal than 
E) less equal than 
A) more equal than 
B) equal to 
C) not comparable to 
D) equal to the distribution of Canadian wealth and more equal than 
E) less equal than

Question 17

The redistribution of income creates the big tradeoff between

Accepted Answer

A) receiving workers' compensation and not receiving workers' compensation. 
B) equity and efficiency. 
C) qualifying to receive employment insurance and not qualifying to receive employment insurance. 
D) earning an income and losing welfare benefits. 
E) being rich and being poor. 
A) receiving workers' compensation and not receiving workers' compensation. 
B) equity and efficiency. 
C) qualifying to receive employment insurance and not qualifying to receive employment insurance. 
D) earning an income and losing welfare benefits. 
E) being rich and being poor.

Question 18

Globalization means that firms recruit top talent from the global talent pool. As a result, the payoffs won by the contest winners

Accepted Answer

A) are increasing. 
B) are decreasing. 
C) are remaining relatively constant. 
D) are paid in U.S. dollars. 
E) are limited by the number of people in a given competition. 
A) are increasing. 
B) are decreasing. 
C) are remaining relatively constant. 
D) are paid in U.S. dollars. 
E) are limited by the number of people in a given competition.

Question 19

Use the table below to answer the following questions.
Table 19.4.1
  
-In Table 19.4.1, which tax plan is proportional?

Accepted Answer

A) Plan A 
B) Plan B 
C) Plan C 
D) Plan D 
E) impossible to calculate without additional information 
A) Plan A 
B) Plan B 
C) Plan C 
D) Plan D 
E) impossible to calculate without additional information

Question 20

From an examination of data on income and wealth, it can be concluded that

Accepted Answer

A) wealth distribution is more equal than income distribution. 
B) income distribution is more equal than wealth distribution. 
C) wealth distribution is equal to income distribution. 
D) income and wealth are the same. 
E) income and wealth are unrelated. 
A) wealth distribution is more equal than income distribution. 
B) income distribution is more equal than wealth distribution. 
C) wealth distribution is equal to income distribution. 
D) income and wealth are the same. 
E) income and wealth are unrelated.

Exam 19: Economic Inequality

Table 19.4.2 -Refer to Table 19.4.2. The table shows three tax payment schemes. Which tax payment plan reduces inequality?

Since 1976 the Canadian Gini ratio has

Economists who have compared the incomes of never-married men and never-married women have found that with equal amounts of human capital

If the supply of labour curve is upward sloping but not vertical, and if the value of marginal product of labour increases,

Use the figure below to answer the following questions. Figure 19.1.2 -Consider the Lorenz curves in Figure 19.1.2. Which point indicates that the richest 20 percent of families earn 60 percent of the income?

Use the figure below to answer the following questions. Figure 19.1.1 -Refer to Figure 19.1.1. The middle 20 percent of households receive what share of total income?

Market income equals

The Gini coefficient for a perfectly equal distribution of income is

Assortative mating means that

Information technologies are ________ for low-skilled labour and ________ for high-skilled labour.

If the average tax rate decreases as income increases, the income tax is

The distribution of annual income

Discrimination results in ________ compared to a situation with no discrimination.

If discrimination takes the form of consumers discriminating against a group of workers, the effect on this group of workers will be to shift their

The distribution of world income is ________ the distribution of Canadian income.

The redistribution of income creates the big tradeoff between

Globalization means that firms recruit top talent from the global talent pool. As a result, the payoffs won by the contest winners

Use the table below to answer the following questions. Table 19.4.1 -In Table 19.4.1, which tax plan is proportional?

From an examination of data on income and wealth, it can be concluded that

What Is Economics

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Information technologies are for low-skilled labour and for high-skilled labour.