Question 1

The twin economic problems of the U.S. health care industry are the

Accepted Answer

A)  rising health care costs and the declining quality of health care services. 
B)  rising health care costs and the rising malpractice insurance costs. 
C)  rising health care costs and the moral hazard problem in health care services. 
D)  declining rate of immunization rates and the rising malpractice insurance costs. 
A)  rising health care costs and the declining quality of health care services. 
B)  rising health care costs and the rising malpractice insurance costs. 
C)  rising health care costs and the moral hazard problem in health care services. 
D)  declining rate of immunization rates and the rising malpractice insurance costs.

Question 2

-Refer to the above figure. Where are the poorest households represented on the graph?

Accepted Answer

A)  The poorest households are to the left along the horizontal axis. 
B)  The poorest households are to the right along the horizontal axis. 
C)  The poorest households are all along the horizontal axis. 
D)  The poorest households are concentrated in the middle. 
A)  The poorest households are to the left along the horizontal axis. 
B)  The poorest households are to the right along the horizontal axis. 
C)  The poorest households are all along the horizontal axis. 
D)  The poorest households are concentrated in the middle.

Question 3

The official poverty level is based on pretax income including cash. Which of the following statements is correct regarding this official specification of poverty?

Accepted Answer

A)  This is a good definition of poverty since it is made up of the income from productive resources. 
B)  This is not a good definition of poverty because our tax structure consists of different tax brackets based on income. 
C)  This is not a good definition of poverty because it does not include in-kind subsidies. 
D)  This is a good definition of poverty because it is easy to measure. 
A)  This is a good definition of poverty since it is made up of the income from productive resources. 
B)  This is not a good definition of poverty because our tax structure consists of different tax brackets based on income. 
C)  This is not a good definition of poverty because it does not include in-kind subsidies. 
D)  This is a good definition of poverty because it is easy to measure.

Question 4

Some economists criticize the Lorenz curve because it

Accepted Answer

A)  accounts for differences in the size of households when it should not. 
B)  does not include the cumulative percentage of households. 
C)  does not include unreported income earned in the underground economy. 
D)  represents the inequality of lifetime income when it should just look at a specific time period. 
A)  accounts for differences in the size of households when it should not. 
B)  does not include the cumulative percentage of households. 
C)  does not include unreported income earned in the underground economy. 
D)  represents the inequality of lifetime income when it should just look at a specific time period.

Question 5

Most individual's income peaks when they are about

Accepted Answer

A)  25. 
B)  40. 
C)  50. 
D)  65. 
A)  25. 
B)  40. 
C)  50. 
D)  65.

Question 6

Earnings usually reflect a person's productivity. What are factors that cause differences in productivity across people so that earnings differ too?

Accepted Answer

Productivity differences reflect differe

Question 7

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 8

In the United States, the distribution of wealth

Accepted Answer

A)  is the same as the distribution of income. 
B)  is more unequal than the distribution of income. 
C)  is more equal than the distribution of income. 
D)  is equal for all families. 
A)  is the same as the distribution of income. 
B)  is more unequal than the distribution of income. 
C)  is more equal than the distribution of income. 
D)  is equal for all families.

Question 9

The common measure of wealth used in calculating the distribution of wealth includes

Accepted Answer

A)  the amount an individual will not receive during retirement. 
B)  workers' claims on private pension funds. 
C)  financial assets. 
D)  human capital. 
A)  the amount an individual will not receive during retirement. 
B)  workers' claims on private pension funds. 
C)  financial assets. 
D)  human capital.

Question 10

How will the federal government's new national health care program be funded?

Accepted Answer

A)  The federal government will charge all participants of health insurance exchanges 3.8%. 
B)  Firms with at least 50 employees must pay an annual fine of up to $750 per employee regardless of coverage. 
C)  A tax rate of 3.8 percent will be assessed on nearly all earnings above $200,000 per year for individuals and above $250,000 per year for married couples. 
D)  Nearly all U.S. residents will pay a fine of up to $750 per year for an individual (up to $2,250 per year for a family) regardless of coverage. 
A)  The federal government will charge all participants of health insurance exchanges 3.8%. 
B)  Firms with at least 50 employees must pay an annual fine of up to $750 per employee regardless of coverage. 
C)  A tax rate of 3.8 percent will be assessed on nearly all earnings above $200,000 per year for individuals and above $250,000 per year for married couples. 
D)  Nearly all U.S. residents will pay a fine of up to $750 per year for an individual (up to $2,250 per year for a family) regardless of coverage.

Question 11

All of the following are key features of the federal government's new 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 12

Inheritance is responsible for about ________ percent of the income inequality in the United States.

Accepted Answer

A)  10 
B)  1 
C)  67 
D)  95 
A)  10 
B)  1 
C)  67 
D)  95

Question 13

The most widely used measure of income inequality is

Accepted Answer

A)  the Bureau of Labor Statistics' cost-of-living index. 
B)  the Laffer curve. 
C)  the Lorenz curve. 
D)  the Gemini coefficient. 
A)  the Bureau of Labor Statistics' cost-of-living index. 
B)  the Laffer curve. 
C)  the Lorenz curve. 
D)  the Gemini coefficient.

Question 14

We measure a person's productive contribution in a market system by

Accepted Answer

A)  the marginal factor cost theory of the firm. 
B)  the profit maximization theory of the firm. 
C)  the marginal revenue product theory of wage determination. 
D)  the egalitarian theory of wage determination. 
A)  the marginal factor cost theory of the firm. 
B)  the profit maximization theory of the firm. 
C)  the marginal revenue product theory of wage determination. 
D)  the egalitarian theory of wage determination.

Question 15

Why doesn't the age-earning cycle continuously increase until retirement age?

Accepted Answer

The typical worker sees a decline in ear

Question 16

Income in kind is defined as

Accepted Answer

A)  income received in the form of a paycheck. 
B)  payment for services in the form of cash. 
C)  tips. 
D)  income received in the form of goods and services. 
A)  income received in the form of a paycheck. 
B)  payment for services in the form of cash. 
C)  tips. 
D)  income received in the form of goods and services.

Question 17

The USDA threshold income level was originally based on the cost of

Accepted Answer

A)  housing. 
B)  transportation. 
C)  basic clothing. 
D)  a nutritionally adequate food plan. 
A)  housing. 
B)  transportation. 
C)  basic clothing. 
D)  a nutritionally adequate food plan.

Question 18

-Use the information in the above table. If Income was evenly distributed, each person would receive

Accepted Answer

A)  $9,000. 
B)  $2,500. 
C)  $1,800. 
D)  $1,000. 
A)  $9,000. 
B)  $2,500. 
C)  $1,800. 
D)  $1,000.

Question 19

-Refer to the above figure. Which curve shows the second most unequal distribution of income?

Accepted Answer

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

Question 20

The impact of technological change in the health-care area has been to

Accepted Answer

A)  increase both the quality of health care and the monetary costs of health care. 
B)  increase the monetary costs of health care and decrease the quality of health care. 
C)  decrease the monetary costs of health care while decreasing the quality of health care. 
D)  increase longevity but decrease quality of life. 
A)  increase both the quality of health care and the monetary costs of health care. 
B)  increase the monetary costs of health care and decrease the quality of health care. 
C)  decrease the monetary costs of health care while decreasing the quality of health care. 
D)  increase longevity but decrease quality of life.

Exam 30: Income, Poverty, and Health Care

The twin economic problems of the U.S. health care industry are the

-Refer to the above figure. Where are the poorest households represented on the graph?

The official poverty level is based on pretax income including cash. Which of the following statements is correct regarding this official specification of poverty?

Some economists criticize the Lorenz curve because it

Most individual's income peaks when they are about

Earnings usually reflect a person's productivity. What are factors that cause differences in productivity across people so that earnings differ too?

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

In the United States, the distribution of wealth

The common measure of wealth used in calculating the distribution of wealth includes

How will the federal government's new national health care program be funded?

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

Inheritance is responsible for about ________ percent of the income inequality in the United States.

The most widely used measure of income inequality is

We measure a person's productive contribution in a market system by

Why doesn't the age-earning cycle continuously increase until retirement age?

Income in kind is defined as

The USDA threshold income level was originally based on the cost of

-Use the information in the above table. If Income was evenly distributed, each person would receive

-Refer to the above figure. Which curve shows the second most unequal distribution of income?

The impact of technological change in the health-care area has been to

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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