Question 1

The more bowed the Lorenz curve, the

Accepted Answer

A)  richer the society. 
B)  more unequal the distribution of money income. 
C)  poorer the society. 
D)  more equal the distribution of income. 
A)  richer the society. 
B)  more unequal the distribution of money income. 
C)  poorer the society. 
D)  more equal the distribution of income.

Question 2

Which of the following would NOT be considered a determinant of marginal productivity?

Accepted Answer

A)  talent 
B)  gender 
C)  experience 
D)  training 
A)  talent 
B)  gender 
C)  experience 
D)  training

Question 3

Based on most observations, what are the effects on government budgets from the national health care program?

Accepted Answer

A)  Tax revenues will not flow into the new program immediately. 
B)  The federal government ultimately will have to search for ways to reduce its health care expenditures. 
C)  Federal government expenditures on the program are being phased in immediately. 
D)  the federal government ultimately will lower taxes since the program's cost will decline over time. 
A)  Tax revenues will not flow into the new program immediately. 
B)  The federal government ultimately will have to search for ways to reduce its health care expenditures. 
C)  Federal government expenditures on the program are being phased in immediately. 
D)  the federal government ultimately will lower taxes since the program's cost will decline over time.

Question 4

-The above figure displays

Accepted Answer

A)  income-inequality curves. 
B)  Gini Coefficients. 
C)  Lorenz curves. 
D)  Laffer curves. 
A)  income-inequality curves. 
B)  Gini Coefficients. 
C)  Lorenz curves. 
D)  Laffer curves.

Question 5

The age-earnings cycle is

Accepted Answer

A)  the distribution of money income by age. 
B)  the distribution of wealth by age. 
C)  the relationship between earnings while working and retirement benefits for an individual. 
D)  the regular earnings profile of an individual throughout his or her lifetime. 
A)  the distribution of money income by age. 
B)  the distribution of wealth by age. 
C)  the relationship between earnings while working and retirement benefits for an individual. 
D)  the regular earnings profile of an individual throughout his or her lifetime.

Question 6

-Refer to the above figure. Perfect income equality is shown by

Accepted Answer

A)  the horizontal axis. 
B)  the vertical axis. 
C)  curve A. 
D)  curve D. 
A)  the horizontal axis. 
B)  the vertical axis. 
C)  curve A. 
D)  curve D.

Question 7

The threshold income level originally used to determine official poverty statistics was based on

Accepted Answer

A)  an income three times the amount of money needed to purchase a nutritionally adequate diet. 
B)  standards provided by the United Nations based on studies done in poor countries around the world. 
C)  the highest income of the lowest one-fifth of families in the country. 
D)  a per capita income of $1,000 in 1958 prices. 
A)  an income three times the amount of money needed to purchase a nutritionally adequate diet. 
B)  standards provided by the United Nations based on studies done in poor countries around the world. 
C)  the highest income of the lowest one-fifth of families in the country. 
D)  a per capita income of $1,000 in 1958 prices.

Question 8

The federal government and insurance companies are examples of third party

Accepted Answer

A)  payers for health care. 
B)  users of health care. 
C)  providers of health care. 
D)  observers of health care. 
A)  payers for health care. 
B)  users of health care. 
C)  providers of health care. 
D)  observers of health care.

Question 9

Under the Social Security program currently in existence

Accepted Answer

A)  benefits are based on need. 
B)  benefits are determined by whether or not one contributed to the system. 
C)  benefits are provided to everyone who contributed to the system EXCEPT those under private retirement programs that provide an annual income in excess of $13,500. 
D)  benefits are guaranteed to be no lower for future retirees than for current retirees. 
A)  benefits are based on need. 
B)  benefits are determined by whether or not one contributed to the system. 
C)  benefits are provided to everyone who contributed to the system EXCEPT those under private retirement programs that provide an annual income in excess of $13,500. 
D)  benefits are guaranteed to be no lower for future retirees than for current retirees.

Question 10

Income in the form of goods and services is

Accepted Answer

A)  known as money income. 
B)  known as income in kind. 
C)  not considered income by economists. 
D)  not part of wealth. 
A)  known as money income. 
B)  known as income in kind. 
C)  not considered income by economists. 
D)  not part of wealth.

Question 11

The distribution of money income can be represented graphically using

Accepted Answer

A)  supply and demand diagrams. 
B)  a Lorenz curve. 
C)  a Keynesian curve. 
D)  a Distribution curve. 
A)  supply and demand diagrams. 
B)  a Lorenz curve. 
C)  a Keynesian curve. 
D)  a Distribution curve.

Question 12

The Lorenz curve is criticized for all of the following EXCEPT

Accepted Answer

A)  that it excludes transfers-in-kind income. 
B)  that it does not account for the size differences of households. 
C)  that it does not account for age differences of households. 
D)  that it does not account for the impact of trade on the standard of living. 
A)  that it excludes transfers-in-kind income. 
B)  that it does not account for the size differences of households. 
C)  that it does not account for age differences of households. 
D)  that it does not account for the impact of trade on the standard of living.

Question 13

The Lorenz curve shows

Accepted Answer

A)  how poverty rates change over time. 
B)  the percentage of population below the poverty line. 
C)  the degree of inequality in the income distribution. 
D)  the ratio of cash income to payments-in-kind. 
A)  how poverty rates change over time. 
B)  the percentage of population below the poverty line. 
C)  the degree of inequality in the income distribution. 
D)  the ratio of cash income to payments-in-kind.

Question 14

Suppose there is a high inequality in household income between the highest and the lowest income groups in one country. In response, the government raises the income tax for the highest income group and provides subsidies to the lowest-income group. What would happen to the Lorenz curve as a result of the government programs? Explain.

Accepted Answer

The government tax and subsidy

Question 15

Wealth is considered to be a

Accepted Answer

A)  nontaxable stream of funds. 
B)  flow. 
C)  stock. 
D)  resource. 
A)  nontaxable stream of funds. 
B)  flow. 
C)  stock. 
D)  resource.

Question 16

-Use the above figure. Refer to the above diagram where curves (a) through (d) are for four different countries. Income is equally distributed in

Accepted Answer

A)  Country A. 
B)  Country B. 
C)  Country C. 
D)  Country D. 
A)  Country A. 
B)  Country B. 
C)  Country C. 
D)  Country D.

Question 17

The more bowed out the Lorenz curve, the

Accepted Answer

A)  less equal the income distribution. 
B)  more equal the income distribution. 
C)  greater the overall wealth in the economy. 
D)  less the overall wealth in the economy. 
A)  less equal the income distribution. 
B)  more equal the income distribution. 
C)  greater the overall wealth in the economy. 
D)  less the overall wealth in the economy.

Question 18

A Lorenz curve measures the ________ on the horizontal axis.

Accepted Answer

A)  cumulative percentage of family income 
B)  cumulative percentage of family wealth 
C)  cumulative percentage of families 
D)  demand of families on welfare 
A)  cumulative percentage of family income 
B)  cumulative percentage of family wealth 
C)  cumulative percentage of families 
D)  demand of families on welfare

Question 19

"The typical age-earning cycle provides evidence of economic discrimination by age." Do you agree or disagree? Why?

Accepted Answer

Disagree. The typical age-earning cycle

Question 20

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

Accepted Answer

A)  reduce the quality of health care while raising the costs. 
B)  reduce the cost of health care. 
C)  increase the quality of health care while decreasing the costs. 
D)  increase both the quality of health care and the costs of health care. 
A)  reduce the quality of health care while raising the costs. 
B)  reduce the cost of health care. 
C)  increase the quality of health care while decreasing the costs. 
D)  increase both the quality of health care and the costs of health care.

Exam 30: Income, Poverty, and Health Care

The more bowed the Lorenz curve, the

Which of the following would NOT be considered a determinant of marginal productivity?

Based on most observations, what are the effects on government budgets from the national health care program?

-The above figure displays

The age-earnings cycle is

-Refer to the above figure. Perfect income equality is shown by

The threshold income level originally used to determine official poverty statistics was based on

The federal government and insurance companies are examples of third party

Under the Social Security program currently in existence

Income in the form of goods and services is

The distribution of money income can be represented graphically using

The Lorenz curve is criticized for all of the following EXCEPT

The Lorenz curve shows

Wealth is considered to be a

-Use the above figure. Refer to the above diagram where curves (a) through (d) are for four different countries. Income is equally distributed in

The more bowed out the Lorenz curve, the

A Lorenz curve measures the ________ on the horizontal axis.

"The typical age-earning cycle provides evidence of economic discrimination by age." Do you agree or disagree? Why?

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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