Exam 21: Income Inequity and Poverty

Diminishing marginal utility suggests that:

In general, the invisible hand of a competitive market acts to allocate resources:

The invisible hand of the marketplace acts to allocate resources efficiently as well as equitably.

Measures of poverty that fail to account for the value of in-kind transfers:

The concept of utility is fundamental to utilitarianism and describes the:

Because people can borrow when they are young, the life cycle theory would suggest that a standard of living depends on:

Economic mobility refers to the:

The rule for redistribution proposed by John Rawls in his book A Theory of Justice is called the:

Income inequality in an economy is traditionally measured by:

How has the women's movement affected income distribution?

According to utilitarianism, the government should choose policies to maximise the total utility of everyone in society.

Founders of utilitarianism include:

Do Libertarians and Rawlsian liberals agree that governments should redistribute income? Briefly explain your answer.

Advocates of direct cash payment assistance to the poor argue that although in-kind transfers are generally respectful of individual preferences, such transfers are inefficient.

Libertarians conclude that equality of incomes is more important than equality of opportunity.

An example of a transitory change in income is:

When a family has the ability to save and borrow, it is more likely to be able to buffer itself from transitory changes in income.

A measure of permanent income would be similar to a person's average or 'normal' income.

According to Rawls, principles of justice are the result of:

Explain how a 'leaky bucket' can be used to illustrate the utilitarian argument that complete equalisation of income should not be attempted.