Question 1

In the United States, the wealthiest 20 percent of households own about ________ of total wealth.

Accepted Answer

A)  44 percent 
B)  53 percent 
C)  62 percent 
D)  83 percent 
A)  44 percent 
B)  53 percent 
C)  62 percent 
D)  83 percent

Question 2

Relative to the supply curve of high-skilled workers, the supply curve of low-skilled workers is

Accepted Answer

A)  to the right. 
B)  above. 
C)  to the left. 
D)  on top of the high-skilled worker supply curve. 
A)  to the right. 
B)  above. 
C)  to the left. 
D)  on top of the high-skilled worker supply curve.

Question 3

When a group is discriminated against, its

Accepted Answer

A)  wages fall but its employment does not. 
B)  employment and its wages decrease. 
C)  employment decreases but its wages do not. 
D)  employment and its wages are unaffected. 
A)  wages fall but its employment does not. 
B)  employment and its wages decrease. 
C)  employment decreases but its wages do not. 
D)  employment and its wages are unaffected.

Question 4

The distribution of world income is ________ the distribution of U.S. income.

Accepted Answer

A)  more equal than 
B)  less equal than 
C)  the same as 
D)  not comparable to 
A)  more equal than 
B)  less equal than 
C)  the same as 
D)  not comparable to

Question 5

Is the poverty rate the lowest among Hispanic households, black households, or white households?

Accepted Answer

The poverty rate is lowest amo

Question 6

The income distribution is a more accurate measure of economic inequality than the wealth distribution because income excludes human capital.

Accepted Answer

A) True 
 B)False

Question 7

-In the figure above, the poorest 20 percent of all households receive what share of all income?

Accepted Answer

A)  10 percent 
B)  20 percent 
C)  30 percent 
D)  40 percent 
A)  10 percent 
B)  20 percent 
C)  30 percent 
D)  40 percent

Question 8

Mr. Scrooge owns assets worth $100 million. The rate of return on his assets is 5 percent per year. Mr. Scrooge's wealth is ________, and his income is ________.

Accepted Answer

A)  $5 million a year; $100 million 
B)  $100 million; $5 million a year 
C)  $100 million; $105 million 
D)  $5 million a year; $100 million a year 
A)  $5 million a year; $100 million 
B)  $100 million; $5 million a year 
C)  $100 million; $105 million 
D)  $5 million a year; $100 million a year

Question 9

The redistribution of income creates the big tradeoff, which is a tradeoff between ________.

Accepted Answer

A)  income and wealth 
B)  equity and efficiency 
C)  rich and poor 
D)  Supplementary Security Income and the Food Stamp program 
A)  income and wealth 
B)  equity and efficiency 
C)  rich and poor 
D)  Supplementary Security Income and the Food Stamp program

Question 10

An example of an income maintenance program is

Accepted Answer

A)  a proportional income tax. 
B)  low-cost college tuition. 
C)  unemployment compensation. 
D)  rent control. 
A)  a proportional income tax. 
B)  low-cost college tuition. 
C)  unemployment compensation. 
D)  rent control.

Question 11

-The above table shows the distribution of wealth and income for Miseria. What percent of wealth is owned by the poorest forty percent of the population?

Accepted Answer

A)  0 percent 
B)  2 percent 
C)  5 percent 
D)  10 percent 
A)  0 percent 
B)  2 percent 
C)  5 percent 
D)  10 percent

Question 12

Welding has changed dramatically over the last decade with more welding jobs dependent on the use of computers. This change increased the demand for welders with computer skills and decreased the demand for welders who lack these skills and is an example of when technology is a ________ to a high-skilled job and a ________ to a low-skilled job.

Accepted Answer

A)  complement; substitute 
B)  complement; complement 
C)  substitute; complement 
D)  substitute; substitute 
A)  complement; substitute 
B)  complement; complement 
C)  substitute; complement 
D)  substitute; substitute

Question 13

A government redistribution of income program is proposed with the aim of making the income distribution the same as the 45° line in a Lorenz curve diagram. What implications does the idea of the "big tradeoff" have for the program?

Accepted Answer

If the distribution of income was the sa

Question 14

-In the figure above, line A represents the

Accepted Answer

A)  the line of market income distribution. 
B)  line of equality. 
C)  line of equal number of people in each household. 
D)  line of equal consumption in each household. 
A)  the line of market income distribution. 
B)  line of equality. 
C)  line of equal number of people in each household. 
D)  line of equal consumption in each household.

Question 15

Measured wealth is a less accurate indicator of economic inequality than is measured income because measured wealth excludes

Accepted Answer

A)  owner-occupied housing. 
B)  financial assets. 
C)  depreciation. 
D)  human capital. 
A)  owner-occupied housing. 
B)  financial assets. 
C)  depreciation. 
D)  human capital.

Question 16

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the costs associated with obtaining skills.

Accepted Answer

A) True 
 B)False

Question 17

-Market income is defined as wages, interest, rent, and profit earned in factor markets plus cash payments to households by the government.

Accepted Answer

A) True 
 B)False

Question 18

-The above figure shows the supply and demand curves for high-skilled and low-skilled labor. Low-skilled workers earn a wage rate of

Accepted Answer

A)  $15 per hour. 
B)  $12 per hour. 
C)  $9 per hour. 
D)  $6 per hour. 
A)  $15 per hour. 
B)  $12 per hour. 
C)  $9 per hour. 
D)  $6 per hour.

Question 19

Mode income is

Accepted Answer

A)  the most common income. 
B)  the average income. 
C)  the middle income level. 
D)  the same as money income. 
A)  the most common income. 
B)  the average income. 
C)  the middle income level. 
D)  the same as money income.

Question 20

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

Accepted Answer

A)  the process of redistribution uses up some of society's resources. 
B)  the process of redistribution creates new resources for society. 
C)  redistribution creates new incentives to work for both rich and poor. 
D)  redistribution would not take place otherwise. 
A)  the process of redistribution uses up some of society's resources. 
B)  the process of redistribution creates new resources for society. 
C)  redistribution creates new incentives to work for both rich and poor. 
D)  redistribution would not take place otherwise.

In the United States, the wealthiest 20 percent of households own about ________ of total wealth.

Relative to the supply curve of high-skilled workers, the supply curve of low-skilled workers is

When a group is discriminated against, its

The distribution of world income is ________ the distribution of U.S. income.

Is the poverty rate the lowest among Hispanic households, black households, or white households?

The income distribution is a more accurate measure of economic inequality than the wealth distribution because income excludes human capital.

-In the figure above, the poorest 20 percent of all households receive what share of all income?

Mr. Scrooge owns assets worth $100 million. The rate of return on his assets is 5 percent per year. Mr. Scrooge's wealth is , and his income is .

The redistribution of income creates the big tradeoff, which is a tradeoff between ________.

An example of an income maintenance program is

-The above table shows the distribution of wealth and income for Miseria. What percent of wealth is owned by the poorest forty percent of the population?

A government redistribution of income program is proposed with the aim of making the income distribution the same as the 45° line in a Lorenz curve diagram. What implications does the idea of the "big tradeoff" have for the program?

-In the figure above, line A represents the

Measured wealth is a less accurate indicator of economic inequality than is measured income because measured wealth excludes

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the costs associated with obtaining skills.

-Market income is defined as wages, interest, rent, and profit earned in factor markets plus cash payments to households by the government.

-The above figure shows the supply and demand curves for high-skilled and low-skilled labor. Low-skilled workers earn a wage rate of

Mode income is

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Uncertainty and Information

Filters

Exam 19: Economic Inequality

In the United States, the wealthiest 20 percent of households own about ________ of total wealth.

Relative to the supply curve of high-skilled workers, the supply curve of low-skilled workers is

When a group is discriminated against, its

The distribution of world income is ________ the distribution of U.S. income.

Is the poverty rate the lowest among Hispanic households, black households, or white households?

The income distribution is a more accurate measure of economic inequality than the wealth distribution because income excludes human capital.

-In the figure above, the poorest 20 percent of all households receive what share of all income?

Mr. Scrooge owns assets worth $100 million. The rate of return on his assets is 5 percent per year. Mr. Scrooge's wealth is ________, and his income is ________.

The redistribution of income creates the big tradeoff, which is a tradeoff between ________.

An example of an income maintenance program is

-The above table shows the distribution of wealth and income for Miseria. What percent of wealth is owned by the poorest forty percent of the population?

A government redistribution of income program is proposed with the aim of making the income distribution the same as the 45° line in a Lorenz curve diagram. What implications does the idea of the "big tradeoff" have for the program?

-In the figure above, line A represents the

Measured wealth is a less accurate indicator of economic inequality than is measured income because measured wealth excludes

The demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers because of the costs associated with obtaining skills.

-Market income is defined as wages, interest, rent, and profit earned in factor markets plus cash payments to households by the government.

-The above figure shows the supply and demand curves for high-skilled and low-skilled labor. Low-skilled workers earn a wage rate of

Mode income is

Using the government as a means of redistribution generates equity at the cost of efficiency, in part because

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Uncertainty and Information

Filters

Mr. Scrooge owns assets worth $100 million. The rate of return on his assets is 5 percent per year. Mr. Scrooge's wealth is , and his income is .