Question 1

Minority workers are underrepresented and have less access to certain high-paying occupations. This illustrates

Accepted Answer

A)  human-capital discrimination. 
B)  the crowding model. 
C)  the taste-for-discrimination model. 
D)  statistical discrimination. 
A)  human-capital discrimination. 
B)  the crowding model. 
C)  the taste-for-discrimination model. 
D)  statistical discrimination.

Question 2

Differences in skills or ability are one major reason for income differences in the United States.

Accepted Answer

A) True 
 B)False

Question 3

According to the standard government definitions, the percentage of the U.S. population now (2014) considered to be living in poverty is about

Accepted Answer

A)  14.8 percent. 
B)  23.6 percent. 
C)  13.1 percent. 
D)  46.7 percent. 
A)  14.8 percent. 
B)  23.6 percent. 
C)  13.1 percent. 
D)  46.7 percent.

Question 4

In a labor market generally biased against Hispanics, a reduction in the collective discrimination coefficients of employers will

Accepted Answer

A)  reduce the Hispanic wage rate, increase Hispanic employment, and lower the actual Hispanic-white wage ratio. 
B)  reduce the Hispanic wage rate, decrease Hispanic employment, and lower the actual Hispanic-white wage ratio. 
C)  increase the Hispanic wage rate, increase Hispanic employment, and increase the actual Hispanic-white wage ratio. 
D)  increase the Hispanic wage rate, reduce Hispanic employment, and increase the actual Hispanic-white wage ratio. 
A)  reduce the Hispanic wage rate, increase Hispanic employment, and lower the actual Hispanic-white wage ratio. 
B)  reduce the Hispanic wage rate, decrease Hispanic employment, and lower the actual Hispanic-white wage ratio. 
C)  increase the Hispanic wage rate, increase Hispanic employment, and increase the actual Hispanic-white wage ratio. 
D)  increase the Hispanic wage rate, reduce Hispanic employment, and increase the actual Hispanic-white wage ratio.

Question 5

The Social Security program is financed with funds from general tax revenues of the federal government.

Accepted Answer

A) True 
 B)False

Question 6

Suppose the members of population A, consisting of Al, Bob, Curt, Doris, and Ellie, receive annual incomes of $5,000, $2,500, $1,250, $750, and $500, respectively. What percentage of total income is received by the richest quintile?

Accepted Answer

A)  50 
B)  5 
C)  25 
D)  20 
A)  50 
B)  5 
C)  25 
D)  20

Question 7

Government programs, such as Social Security, food stamps, AFDC, SSI, Medicare, and Medicaid, that guarantee particular levels of transfer payments to all who fit the programs' criteria are called

Accepted Answer

A)  public assistance programs. 
B)  social insurance programs. 
C)  benefit-reduction programs. 
D)  entitlement programs. 
A)  public assistance programs. 
B)  social insurance programs. 
C)  benefit-reduction programs. 
D)  entitlement programs.

Question 8

The TANF program is designed to

Accepted Answer

A)  increase the minimum wage. 
B)  shift people from welfare to employment. 
C)  provide medical insurance to poverty-level workers. 
D)  provide income to the blind and disabled. 
A)  increase the minimum wage. 
B)  shift people from welfare to employment. 
C)  provide medical insurance to poverty-level workers. 
D)  provide income to the blind and disabled.

Question 9

The top 20 percent of U.S. income earners receive nearly 80 percent of total U.S. income.

Accepted Answer

A) True 
 B)False

Question 10

The poverty rate in the U.S. increased significantly in the period 2006-2014.

Accepted Answer

A) True 
 B)False

Question 11

The entrance of large numbers of "baby boomers" into the labor force in the 1970s and 1980s

Accepted Answer

A)  caused substantial reductions in permanent unemployment. 
B)  lessened income inequality. 
C)  increased income inequality. 
D)  had no impact on income inequality. 
A)  caused substantial reductions in permanent unemployment. 
B)  lessened income inequality. 
C)  increased income inequality. 
D)  had no impact on income inequality.

Question 12

(Last Word) Between 1995 and 2007 in the United States,

Accepted Answer

A)  average U.S. household wealth increased and median household wealth declined. 
B)  average U.S. household wealth declined and median household wealth increased. 
C)  both average and median U.S. household wealth declined. 
D)  both average and median U.S. household wealth increased. 
A)  average U.S. household wealth increased and median household wealth declined. 
B)  average U.S. household wealth declined and median household wealth increased. 
C)  both average and median U.S. household wealth declined. 
D)  both average and median U.S. household wealth increased.

Question 13

(Consider This) A "welfare cliff" refers to a situation where

Accepted Answer

A)  falling welfare benefits increase suicide rates. 
B)  a welfare recipient's total income falls if they earn more money from work. 
C)  government support for income assistance falls when the unemployment rate falls below a preset value. 
D)  welfare benefits are withdrawn when a recipient hits the five-year program limit. 
A)  falling welfare benefits increase suicide rates. 
B)  a welfare recipient's total income falls if they earn more money from work. 
C)  government support for income assistance falls when the unemployment rate falls below a preset value. 
D)  welfare benefits are withdrawn when a recipient hits the five-year program limit.

Question 14

If a law firm prefers to hire men over women because the firm has found men to be more productive, on average, then the firm is practicing

Accepted Answer

A)  wage discrimination. 
B)  reverse discrimination. 
C)  statistical discrimination. 
D)  human-capital discrimination. 
A)  wage discrimination. 
B)  reverse discrimination. 
C)  statistical discrimination. 
D)  human-capital discrimination.

Question 15

The Lorenz curve

Accepted Answer

A)  plots graphically the poverty rate over time. 
B)  is located closer to the diagonal today than it was in 1975. 
C)  plots graphically the distribution of income. 
D)  is located farther from the diagonal when income is defined to include the value of noncash transfers. 
A)  plots graphically the poverty rate over time. 
B)  is located closer to the diagonal today than it was in 1975. 
C)  plots graphically the distribution of income. 
D)  is located farther from the diagonal when income is defined to include the value of noncash transfers.

Question 16

In the U.S. in 2010, the top 1 percent of households held 35 percent of total wealth, leaving 65 percent of wealth to the remaining 99 percent of households.

Accepted Answer

A) True 
 B)False

Question 17

Since its inception in 1996, the Temporary Assistance for Needy Families (TANF) program has

Accepted Answer

A)  increased, rather than reduced, the number of people on welfare. 
B)  reduced the number of people on welfare by more than one-half. 
C)  aided the poor by automatically increasing welfare payments when inflation occurs. 
D)  greatly increased the unemployment rate. 
A)  increased, rather than reduced, the number of people on welfare. 
B)  reduced the number of people on welfare by more than one-half. 
C)  aided the poor by automatically increasing welfare payments when inflation occurs. 
D)  greatly increased the unemployment rate.

Question 18

The difference between household assets and liabilities is referred to as

Accepted Answer

A)  debt. 
B)  income. 
C)  net worth. 
D)  expenditures. 
A)  debt. 
B)  income. 
C)  net worth. 
D)  expenditures.

Question 19

The movement of individuals and households from one income quintile to another over time is called

Accepted Answer

A)  income averaging. 
B)  wealth turnover. 
C)  income mobility. 
D)  the ratchet effect. 
A)  income averaging. 
B)  wealth turnover. 
C)  income mobility. 
D)  the ratchet effect.

Question 20

The poverty rate for African Americans is

Accepted Answer

A)  greater than for any other racial or ethnic group. 
B)  below that for whites. 
C)  considerably lower than that for Hispanics. 
D)  below that for persons 65 years of age or older. 
A)  greater than for any other racial or ethnic group. 
B)  below that for whites. 
C)  considerably lower than that for Hispanics. 
D)  below that for persons 65 years of age or older.

Exam 23: Income Inequality, Poverty, and Discrimination

Minority workers are underrepresented and have less access to certain high-paying occupations. This illustrates

Differences in skills or ability are one major reason for income differences in the United States.

According to the standard government definitions, the percentage of the U.S. population now (2014) considered to be living in poverty is about

In a labor market generally biased against Hispanics, a reduction in the collective discrimination coefficients of employers will

The Social Security program is financed with funds from general tax revenues of the federal government.

Suppose the members of population A, consisting of Al, Bob, Curt, Doris, and Ellie, receive annual incomes of $5,000, $2,500, $1,250, $750, and $500, respectively. What percentage of total income is received by the richest quintile?

Government programs, such as Social Security, food stamps, AFDC, SSI, Medicare, and Medicaid, that guarantee particular levels of transfer payments to all who fit the programs' criteria are called

The TANF program is designed to

The top 20 percent of U.S. income earners receive nearly 80 percent of total U.S. income.

The poverty rate in the U.S. increased significantly in the period 2006-2014.

The entrance of large numbers of "baby boomers" into the labor force in the 1970s and 1980s

(Last Word) Between 1995 and 2007 in the United States,

(Consider This) A "welfare cliff" refers to a situation where

If a law firm prefers to hire men over women because the firm has found men to be more productive, on average, then the firm is practicing

The Lorenz curve

In the U.S. in 2010, the top 1 percent of households held 35 percent of total wealth, leaving 65 percent of wealth to the remaining 99 percent of households.

Since its inception in 1996, the Temporary Assistance for Needy Families (TANF) program has

The difference between household assets and liabilities is referred to as

The movement of individuals and households from one income quintile to another over time is called

The poverty rate for African Americans is

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

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Pure Competition in the Short Run

Pure Competition in the Long Run

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Technology, Rd, and Efficiency

The Demand for Resources

Wage Determination

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The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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