Question 1

In 2011, what percentage of U.S. families had income levels above $115,866?

Accepted Answer

A)  10 percent 
B)  20 percent 
C)  60 percent 
D)  80 percent 
A)  10 percent 
B)  20 percent 
C)  60 percent 
D)  80 percent

Question 2

In 2011, what percentage of U.S. families had income levels below $75,000?

Accepted Answer

A)  20 percent 
B)  40 percent 
C)  60 percent 
D)  80 percent 
A)  20 percent 
B)  40 percent 
C)  60 percent 
D)  80 percent

Question 3

The 2011 U.S. distribution of income shows that the top 5 percent of families have approximately what share of income?

Accepted Answer

A)  4 percent 
B)  9 percent 
C)  21 percent 
D)  49 percent 
A)  4 percent 
B)  9 percent 
C)  21 percent 
D)  49 percent

Question 4

About half of black and Hispanic children in female-headed households live in poverty.

Accepted Answer

A) True 
 B)False

Question 5

Temporary Assistance for Needy Families (TANF) is an example of a negative income tax program.

Accepted Answer

A) True 
 B)False

Question 6

Figure 20-1 Number of Poor  
-Refer to Figure 20-1. The absolute number of people in poverty

Accepted Answer

A)  is higher in 2011 than in 1959. 
B)  is lower in 2011 than in 1959. 
C)  has not changed between 1959 and 2011. 
D)  has steadily decreased between 1959 and 2011. 
A)  is higher in 2011 than in 1959. 
B)  is lower in 2011 than in 1959. 
C)  has not changed between 1959 and 2011. 
D)  has steadily decreased between 1959 and 2011.

Question 7

Explain the concept of diminishing marginal utility, and describe the role that it plays in the utilitarian argument for the redistribution of income.

Accepted Answer

Diminishing marginal utility refers to t

Question 8

The political philosophy that views the redistribution of income as a form of social insurance is

Accepted Answer

A)  utilitarianism 
B)  liberalism 
C)  libertarianism 
D)  welfarism 
A)  utilitarianism 
B)  liberalism 
C)  libertarianism 
D)  welfarism

Question 9

Which political philosophy argues that the government should choose policies deemed just, as evaluated by an impartial observer?

Accepted Answer

The answer of Which political philosophy argues that the government...

Question 10

In the United States, long-term poverty, defined as a family having an income below the poverty line for eight or more years, is

Accepted Answer

A)  common, affecting approximately 25 percent of all American families. 
B)  common, affecting approximately 15 percent of all American families. 
C)  uncommon, affecting approximately 8 percent of all American families. 
D)  rare, affecting approximately 3 percent of all American families. 
A)  common, affecting approximately 25 percent of all American families. 
B)  common, affecting approximately 15 percent of all American families. 
C)  uncommon, affecting approximately 8 percent of all American families. 
D)  rare, affecting approximately 3 percent of all American families.

Question 11

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

Accepted Answer

A)  understate the actual poverty rate. 
B)  have little effect on the validity of reported poverty rates. 
C)  are generally more reliable measures of actual poverty rates. 
D)  overstate the actual poverty rate. 
A)  understate the actual poverty rate. 
B)  have little effect on the validity of reported poverty rates. 
C)  are generally more reliable measures of actual poverty rates. 
D)  overstate the actual poverty rate.

Question 12

The regular pattern of income variation over a person's life is called the

Accepted Answer

A)  earned income cycle. 
B)  substitution effect. 
C)  life cycle. 
D)  pattern of change. 
A)  earned income cycle. 
B)  substitution effect. 
C)  life cycle. 
D)  pattern of change.

Question 13

According to a utilitarian, total social utility will be maximized when marginal dollars are distributed to the people with the

Accepted Answer

A)  lowest marginal utility of income. 
B)  highest marginal utility of income. 
C)  highest total utility from their income. 
D)  most productive labor resources. 
A)  lowest marginal utility of income. 
B)  highest marginal utility of income. 
C)  highest total utility from their income. 
D)  most productive labor resources.

Question 14

Table 20-11
Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars]
  
-Refer to Table 20-11. What is the poverty line for a family of six with three children?

Accepted Answer

A)  $29,494 
B)  $31,005 
C)  $32,181 
D)  $26,844 
A)  $29,494 
B)  $31,005 
C)  $32,181 
D)  $26,844

Question 15

On what type of income do many economists believe that people base their consumption?

Accepted Answer

The answer of On what type of income do many...

Question 16

Table 20-11
Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars]
  
-Refer to Table 20-11. What is the poverty line for a family of three with one child?

Accepted Answer

A)  $17,595 
B)  $18,106 
C)  $18,123 
D)  $22,891 
A)  $17,595 
B)  $18,106 
C)  $18,123 
D)  $22,891

Question 17

The poverty rate is the percentage of the population whose family income falls below the poverty line.

Accepted Answer

A) True 
 B)False

Question 18

According to libertarians, the government should redistribute income from rich individuals to poor individuals to achieve a more equal distribution of income.

Accepted Answer

A) True 
 B)False

Question 19

The distribution of income for Dismal is as follows: Number of Families Income
    1,000 less than $10,000
2,000 between $10,000 and $20,000
2,000 between $20,000 and $30,000
800 between $30,000 and $40,000
200 over $40,000
  If the poverty rate in Dismal is about 17 percent, what is the poverty line in Dismal?

Accepted Answer

A)  $10,000. 
B)  $20,000. 
C)  $30,000. 
D)  $40,000. 
A)  $10,000. 
B)  $20,000. 
C)  $30,000. 
D)  $40,000.

Question 20

Table 20-1
The following table shows the distribution of income in Marysville.
  
-Refer to Table 20-1. If the poverty line was $31,852, what would be the poverty rate?

Accepted Answer

A)  less than 25% 
B)  between 25% and 50% 
C)  between 50% and 75% 
D)  There is insufficient information to answer this question. 
A)  less than 25% 
B)  between 25% and 50% 
C)  between 50% and 75% 
D)  There is insufficient information to answer this question.

Exam 20: Income Inequality and Poverty

In 2011, what percentage of U.S. families had income levels above $115,866?

In 2011, what percentage of U.S. families had income levels below $75,000?

The 2011 U.S. distribution of income shows that the top 5 percent of families have approximately what share of income?

About half of black and Hispanic children in female-headed households live in poverty.

Temporary Assistance for Needy Families (TANF) is an example of a negative income tax program.

Figure 20-1 Number of Poor -Refer to Figure 20-1. The absolute number of people in poverty

Explain the concept of diminishing marginal utility, and describe the role that it plays in the utilitarian argument for the redistribution of income.

The political philosophy that views the redistribution of income as a form of social insurance is

Which political philosophy argues that the government should choose policies deemed just, as evaluated by an impartial observer?

In the United States, long-term poverty, defined as a family having an income below the poverty line for eight or more years, is

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

The regular pattern of income variation over a person's life is called the

According to a utilitarian, total social utility will be maximized when marginal dollars are distributed to the people with the

Table 20-11 Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars] -Refer to Table 20-11. What is the poverty line for a family of six with three children?

On what type of income do many economists believe that people base their consumption?

Table 20-11 Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars] -Refer to Table 20-11. What is the poverty line for a family of three with one child?

The poverty rate is the percentage of the population whose family income falls below the poverty line.

According to libertarians, the government should redistribute income from rich individuals to poor individuals to achieve a more equal distribution of income.

Table 20-1 The following table shows the distribution of income in Marysville. -Refer to Table 20-1. If the poverty line was $31,852, what would be the poverty rate?

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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