Question 1

Going to college to get more knowledge and skills is considered to be an increase in

Accepted Answer

A)  physical capital. 
B)  consumption. 
C)  human capital. 
D)  net exports. 
A)  physical capital. 
B)  consumption. 
C)  human capital. 
D)  net exports.

Question 2

Which of the following is NOT a reason for the increase in health care costs?

Accepted Answer

A)  the aging of the population 
B)  the implementation of new technologies 
C)  the increase in third party payments 
D)  the decrease in the fertility rate 
A)  the aging of the population 
B)  the implementation of new technologies 
C)  the increase in third party payments 
D)  the decrease in the fertility rate

Question 3

Which of the following is NOT a program designed to attack poverty?

Accepted Answer

A)  Supplementary Security Income 
B)  food stamps 
C)  Social Security 
D)  federal corporate income tax 
A)  Supplementary Security Income 
B)  food stamps 
C)  Social Security 
D)  federal corporate income tax

Question 4

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 5

How does the distribution of wealth differ from the distribution of income in the United States?

Accepted Answer

As conventionally measured, the distribu

Question 6

The official definition of poverty is

Accepted Answer

A)  exactly the 10 percent of U.S. residents with the lowest incomes. 
B)  exactly the 20 percent of U.S. residents with the lowest incomes. 
C)  exactly the 50 percent of U.S. residents with the lowest incomes. 
D)  a relative measure. 
A)  exactly the 10 percent of U.S. residents with the lowest incomes. 
B)  exactly the 20 percent of U.S. residents with the lowest incomes. 
C)  exactly the 50 percent of U.S. residents with the lowest incomes. 
D)  a relative measure.

Question 7

"To each exactly the same" refers to

Accepted Answer

A)  the productivity standard. 
B)  the free market doctrine. 
C)  the egalitarian principle. 
D)  the ceteris paribus assumption. 
A)  the productivity standard. 
B)  the free market doctrine. 
C)  the egalitarian principle. 
D)  the ceteris paribus assumption.

Question 8

When poverty is defined by an absolute real income level, what will happen to the poverty rate if income per capita in a country continues to grow?

Accepted Answer

A)  The poverty rate will increase forever. 
B)  The poverty rate will eventually be zero. 
C)  The poverty rate will increase and then decrease. 
D)  The poverty rate will never change. 
A)  The poverty rate will increase forever. 
B)  The poverty rate will eventually be zero. 
C)  The poverty rate will increase and then decrease. 
D)  The poverty rate will never change.

Question 9

The incidence of absolute poverty is reduced by

Accepted Answer

A)  annual recalculations of the poverty line. 
B)  government welfare programs. 
C)  economic growth. 
D)  the size of the budget deficit. 
A)  annual recalculations of the poverty line. 
B)  government welfare programs. 
C)  economic growth. 
D)  the size of the budget deficit.

Question 10

Which of the following is NOT a subsidy in the new the federal government's new national health care program?

Accepted Answer

A)  Families with incomes up to 133% of the federal poverty level are eligible for federal Medicaid coverage. 
B)  Families with incomes up to 400% of the federal poverty level are eligible for thousands of dollars in tax subsidies per year (amounts vary with family incomes). 
C)  Tax credits are available to businesses providing health insurance to 25 or fewer workers and paying annual salaries averaging no more than $50,000. 
D)  A special subsidy rate of 3.8% is applied to nearly all income earnings above $200,000 for individuals or $250,000 for married couples. 
A)  Families with incomes up to 133% of the federal poverty level are eligible for federal Medicaid coverage. 
B)  Families with incomes up to 400% of the federal poverty level are eligible for thousands of dollars in tax subsidies per year (amounts vary with family incomes). 
C)  Tax credits are available to businesses providing health insurance to 25 or fewer workers and paying annual salaries averaging no more than $50,000. 
D)  A special subsidy rate of 3.8% is applied to nearly all income earnings above $200,000 for individuals or $250,000 for married couples.

Question 11

The Lorenz curve

Accepted Answer

A)  shows what portion of the population are living in poverty and what portion are living in wealth. 
B)  shows what portion of total money income is accounted for by different proportions of the nation's households. 
C)  shows what portion of the population is working as professionals, white- and blue-collar, workers and workers at menial tasks. 
D)  breaks down the income levels of each group in the economy. 
A)  shows what portion of the population are living in poverty and what portion are living in wealth. 
B)  shows what portion of total money income is accounted for by different proportions of the nation's households. 
C)  shows what portion of the population is working as professionals, white- and blue-collar, workers and workers at menial tasks. 
D)  breaks down the income levels of each group in the economy.

Question 12

The official poverty level is based on

Accepted Answer

A)  total net worth. 
B)  pretax income, and includes cash subsidies but does not include in-kind subsidies such as food stamps. 
C)  after-tax income, and includes both cash and in-kind government subsidies. 
D)  wages and salaries, plus any unreported amounts of income from the underground economy. 
A)  total net worth. 
B)  pretax income, and includes cash subsidies but does not include in-kind subsidies such as food stamps. 
C)  after-tax income, and includes both cash and in-kind government subsidies. 
D)  wages and salaries, plus any unreported amounts of income from the underground economy.

Question 13

Approximately how much of aggregate national income in the United States is spent on health care today?

Accepted Answer

A)  3 percent 
B)  45 percent 
C)  17 percent 
D)  34 percent 
A)  3 percent 
B)  45 percent 
C)  17 percent 
D)  34 percent

Question 14

The federal government began officially measuring poverty in the

Accepted Answer

A)  1860s. 
B)  1900s. 
C)  1980s. 
D)  1960s. 
A)  1860s. 
B)  1900s. 
C)  1980s. 
D)  1960s.

Question 15

The age-earning cycle shows an individual typically earning

Accepted Answer

A)  a constant income (adjusted for inflation) over the entire working life of the worker. 
B)  an income that cycles upward and downward as an individual ages. 
C)  an income that increases with age, peaks, and then falls as retirement approaches. 
D)  an income that declines until age 30-35 and then increases rapidly. 
A)  a constant income (adjusted for inflation) over the entire working life of the worker. 
B)  an income that cycles upward and downward as an individual ages. 
C)  an income that increases with age, peaks, and then falls as retirement approaches. 
D)  an income that declines until age 30-35 and then increases rapidly.

Question 16

In a competitive economy, workers will be paid according to their

Accepted Answer

A)  status. 
B)  age. 
C)  marginal productivity. 
D)  need. 
A)  status. 
B)  age. 
C)  marginal productivity. 
D)  need.

Question 17

One reason some economists are critical of the Lorenz curve is because

Accepted Answer

A)  it reflects income before taxes. 
B)  it reflects income after taxes. 
C)  it reflects only the top bracket of taxpayers. 
D)  it reflects only the poor in the country. 
A)  it reflects income before taxes. 
B)  it reflects income after taxes. 
C)  it reflects only the top bracket of taxpayers. 
D)  it reflects only the poor in the country.

Question 18

Once the national health care program goes into effect, we can expect

Accepted Answer

A)  the quantity of health care services supplied will increase. 
B)  total expenditures on health care will decrease. 
C)  more individuals will pay more out of pocket expenses. 
D)  moral hazard will increase. 
A)  the quantity of health care services supplied will increase. 
B)  total expenditures on health care will decrease. 
C)  more individuals will pay more out of pocket expenses. 
D)  moral hazard will increase.

Question 19

A Lorenz curve that represents an unequal income distribution is

Accepted Answer

A)  a straight line starting at the origin. 
B)  a straight line starting at 100% 
C)  a bowed curved. 
D)  a line that has a kink in the middle of it. 
A)  a straight line starting at the origin. 
B)  a straight line starting at 100% 
C)  a bowed curved. 
D)  a line that has a kink in the middle of it.

Question 20

Which of the following is the best definition of what economists define as total income?

Accepted Answer

A)  payment for labor services 
B)  payment for labor services and for ownership of other factors of production 
C)  payment for labor services, for use of other factors of production, and gifts and government transfers 
D)  inheritance 
A)  payment for labor services 
B)  payment for labor services and for ownership of other factors of production 
C)  payment for labor services, for use of other factors of production, and gifts and government transfers 
D)  inheritance

Exam 30: Income, Poverty, and Health Care

Going to college to get more knowledge and skills is considered to be an increase in

Which of the following is NOT a reason for the increase in health care costs?

Which of the following is NOT a program designed to attack poverty?

The main cost of a college education is

How does the distribution of wealth differ from the distribution of income in the United States?

The official definition of poverty is

"To each exactly the same" refers to

When poverty is defined by an absolute real income level, what will happen to the poverty rate if income per capita in a country continues to grow?

The incidence of absolute poverty is reduced by

Which of the following is NOT a subsidy in the new the federal government's new national health care program?

The Lorenz curve

The official poverty level is based on

Approximately how much of aggregate national income in the United States is spent on health care today?

The federal government began officially measuring poverty in the

The age-earning cycle shows an individual typically earning

In a competitive economy, workers will be paid according to their

One reason some economists are critical of the Lorenz curve is because

Once the national health care program goes into effect, we can expect

A Lorenz curve that represents an unequal income distribution is

Which of the following is the best definition of what economists define as total 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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