Question 1

The wealthiest 10 percent of the population owns about

Accepted Answer

A)  30 percent of all the wealth in the United States. 
B)  50 percent of all the wealth in the United States. 
C)  70 percent of all the wealth in the United States. 
D)  90 percent of all the wealth in the United States. 
A)  30 percent of all the wealth in the United States. 
B)  50 percent of all the wealth in the United States. 
C)  70 percent of all the wealth in the United States. 
D)  90 percent of all the wealth in the United States.

Question 2

The age-earnings profile for most people indicates

Accepted Answer

A)  earnings rise continually until a person retires. 
B)  earnings initially decline and then rise continually until retirement. 
C)  that when you adjust for inflation, earnings are constant throughout the entire workplace experience. 
D)  earnings rise until the age of about 50 and then begin to fall until retirement. 
A)  earnings rise continually until a person retires. 
B)  earnings initially decline and then rise continually until retirement. 
C)  that when you adjust for inflation, earnings are constant throughout the entire workplace experience. 
D)  earnings rise until the age of about 50 and then begin to fall until retirement.

Question 3

The percentage of total national income spent on health care in the United States has

Accepted Answer

A)  declined rapidly since 1965. 
B)  remained below the level of inflation. 
C)  risen steadily since 1965. 
D)  remained constant over the last few years. 
A)  declined rapidly since 1965. 
B)  remained below the level of inflation. 
C)  risen steadily since 1965. 
D)  remained constant over the last few years.

Question 4

How is moral hazard related to health care?

Accepted Answer

Moral hazard is affiliated with many ins

Question 5

Draw and explain a Lorenz curve.

Accepted Answer

@#IMG-DLM& In the above figure, the curve displayi

Question 6

The main cost of a college education is

Accepted Answer

A)  tuition if one goes to a private college and room and board if one goes to a public college. 
B)  dependent upon whether one's parents pay for the college or not. 
C)  the lack of practical experience from spending time in college. 
D)  the opportunity cost of not working. 
A)  tuition if one goes to a private college and room and board if one goes to a public college. 
B)  dependent upon whether one's parents pay for the college or not. 
C)  the lack of practical experience from spending time in college. 
D)  the opportunity cost of not working.

Question 7

-Use the information in the above table. The top 40 percent of the population earn

Accepted Answer

A)  66.7 percent of the income. 
B)  55.5 percent of the income. 
C)  50.0 percent of the income. 
D)  44.4 percent of the income. 
A)  66.7 percent of the income. 
B)  55.5 percent of the income. 
C)  50.0 percent of the income. 
D)  44.4 percent of the income.

Question 8

Wealth is measured as

Accepted Answer

A)  only tangible objects. 
B)  only buildings, machinery, land, cars, stocks and bonds. 
C)  only nonhuman wealth. 
D)  nonhuman and human wealth. 
A)  only tangible objects. 
B)  only buildings, machinery, land, cars, stocks and bonds. 
C)  only nonhuman wealth. 
D)  nonhuman and human wealth.

Question 9

What is typically the main cost of pursuing a college education?

Accepted Answer

A)  Tuition 
B)  Room and board 
C)  Books and supplies 
D)  Income forgone by not working 
A)  Tuition 
B)  Room and board 
C)  Books and supplies 
D)  Income forgone by not working

Question 10

Compared to the distribution of money income, the distribution of wealth is

Accepted Answer

A)  about the same. 
B)  much more equal. 
C)  much less equal. 
D)  a little more equal. 
A)  about the same. 
B)  much more equal. 
C)  much less equal. 
D)  a little more equal.

Question 11

Suppose all people have the same age-earnings profile and the percent of the population in each age category is the same. The distribution of income at any point in time will be

Accepted Answer

A)  equal because all have the same profile. 
B)  equal because incomes and wealth levels must then be the same. 
C)  unequal because other sources of income will differ. 
D)  unequal because incomes differ by age. 
A)  equal because all have the same profile. 
B)  equal because incomes and wealth levels must then be the same. 
C)  unequal because other sources of income will differ. 
D)  unequal because incomes differ by age.

Question 12

All of the following are criticisms of the Lorenz curve EXCEPT

Accepted Answer

A)  The Lorenz curve does not include in-kind transfers. 
B)  The Lorenz curve does not account for age differences. 
C)  The Lorenz curve does not account for differences in the sizes of families. 
D)  The Lorenz curve does not account for differences in education levels. 
A)  The Lorenz curve does not include in-kind transfers. 
B)  The Lorenz curve does not account for age differences. 
C)  The Lorenz curve does not account for differences in the sizes of families. 
D)  The Lorenz curve does not account for differences in education levels.

Question 13

All of the following are key features of the new the federal government's national health care program EXCEPT

Accepted Answer

A)  people must either purchase health insurance or pay a fine to the federal government. 
B)  a young person in good health can opt not to purchase health insurance without penalty. 
C)  firms with at least 50 employees must either provide health insurance or pay fines when uninsured employees receive tax subsidies to purchase insurance. 
D)  Government-directed exchanges will assist in matching individuals and small businesses with health insurance policies that satisfy government requirements. 
A)  people must either purchase health insurance or pay a fine to the federal government. 
B)  a young person in good health can opt not to purchase health insurance without penalty. 
C)  firms with at least 50 employees must either provide health insurance or pay fines when uninsured employees receive tax subsidies to purchase insurance. 
D)  Government-directed exchanges will assist in matching individuals and small businesses with health insurance policies that satisfy government requirements.

Question 14

If a goal of a nation's residents is to increase marginal productivity, they should increase

Accepted Answer

A)  expenditures on education. 
B)  the inheritance tax. 
C)  exports. 
D)  the marginal propensity to consume. 
A)  expenditures on education. 
B)  the inheritance tax. 
C)  exports. 
D)  the marginal propensity to consume.

Question 15

Social Security is

Accepted Answer

A)  an insurance program operated by the federal government. 
B)  a retirement program that invests the person's contributions into interest-earning financial assets so the proceeds can fund the person's retirement. 
C)  a social insurance program that guarantees that an elderly person will never fall below the poverty level. 
D)  an intergenerational transfer program that only vaguely relates to past earnings. 
A)  an insurance program operated by the federal government. 
B)  a retirement program that invests the person's contributions into interest-earning financial assets so the proceeds can fund the person's retirement. 
C)  a social insurance program that guarantees that an elderly person will never fall below the poverty level. 
D)  an intergenerational transfer program that only vaguely relates to past earnings.

Question 16

Rising health care spending is a problem confronting the federal government because

Accepted Answer

A)  it is the government's job to make sure everyone receives the health care they need. 
B)  federal spending on health care has increased rapidly over the last thirty years. 
C)  the federal-funded VA hospitals have been expanding faster than government revenues can provide for. 
D)  the medical expenses of federal employees has been rising at a rate much faster than for non-federal workers. 
A)  it is the government's job to make sure everyone receives the health care they need. 
B)  federal spending on health care has increased rapidly over the last thirty years. 
C)  the federal-funded VA hospitals have been expanding faster than government revenues can provide for. 
D)  the medical expenses of federal employees has been rising at a rate much faster than for non-federal workers.

Question 17

Which of the following statements is an accurate statement about the Social Security (OASDI) program?

Accepted Answer

A)  The program is financed by voluntary contributions. 
B)  Only 50 percent of workers are covered by OASDI. 
C)  Benefits are based on financial need. 
D)  The program transfers income from those who work to those who do not work. 
A)  The program is financed by voluntary contributions. 
B)  Only 50 percent of workers are covered by OASDI. 
C)  Benefits are based on financial need. 
D)  The program transfers income from those who work to those who do not work.

Question 18

The Lorenz curve is criticized for all of the following EXCEPT

Accepted Answer

A)  that it excludes transfers-in-kind income. 
B)  that it does not account for the size differences of households. 
C)  that it does not account for age differences of households. 
D)  that it does not account for the impact of trade on the standard of living. 
A)  that it excludes transfers-in-kind income. 
B)  that it does not account for the size differences of households. 
C)  that it does not account for age differences of households. 
D)  that it does not account for the impact of trade on the standard of living.

Question 19

Which of the following would be considered income in kind?

Accepted Answer

A)  tax refunds 
B)  food stamps 
C)  yard sales 
D)  reduction in the tax rates 
A)  tax refunds 
B)  food stamps 
C)  yard sales 
D)  reduction in the tax rates

Question 20

-Refer to the above figure. For which Lorenz curve does the richest 25 percent make 50 percent of the nation's money income?

Accepted Answer

A)  A 
B)  B 
C)  C 
D)  D 
A)  A 
B)  B 
C)  C 
D)  D

Exam 30: Income, Poverty, and Health Care

The wealthiest 10 percent of the population owns about

The age-earnings profile for most people indicates

The percentage of total national income spent on health care in the United States has

How is moral hazard related to health care?

Draw and explain a Lorenz curve.

The main cost of a college education is

-Use the information in the above table. The top 40 percent of the population earn

Wealth is measured as

What is typically the main cost of pursuing a college education?

Compared to the distribution of money income, the distribution of wealth is

Suppose all people have the same age-earnings profile and the percent of the population in each age category is the same. The distribution of income at any point in time will be

All of the following are criticisms of the Lorenz curve EXCEPT

All of the following are key features of the new the federal government's national health care program EXCEPT

If a goal of a nation's residents is to increase marginal productivity, they should increase

Social Security is

Rising health care spending is a problem confronting the federal government because

Which of the following statements is an accurate statement about the Social Security (OASDI) program?

The Lorenz curve is criticized for all of the following EXCEPT

Which of the following would be considered income in kind?

-Refer to the above figure. For which Lorenz curve does the richest 25 percent make 50 percent of the nation's money income?

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, Banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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