Exam 54: Income Distribution, Poverty and Government Policy

The table given below shows the annual incomes of a family of four and the corresponding transfer incomes. Table 33.3 Refer to Table 33.3.Suppose the government changes the guaranteed income floor to $3, 000.What is the new break-even level of income if the negative income tax rate is changed to 20 percent?

Individuals have a tradeoff between leisure and work.When income from working is taxed, the cost of leisure is reduced in relative terms.

The table below shows the distribution of income in the U.S.in the year 1978. Table 33.1 Refer to Table 33.1.What percentage of households earn 31.5% of the income?

The 45-degree line splitting the distance between the axes in a Lorenz Curve is the:

One of the major causes of economic backwardness in the poor countries is:

The table below shows the monthly income of a family and the fuel assistance received from the government. Table 33.4 Refer to Table 33.4.The greatest disincentive to work for this family occurs between the income levels of _____ and _____.

Which of the following is an absolute measure of poverty?

The guaranteed transfer income of Angela's family, which consists of her parents and her sister, is $15, 000.This implies, if the family earns nothing it will receive a transfer of $15, 000.If a negative tax rate of 50 percent is levied, the family's break-even income is:

The measures of absolute poverty:

An imposition of tax by the government for funding welfare programs raises the cost of labor to firms as:

The table given below shows the absolute tax amounts under five different tax policies for respective income levels. Table 33.2 Refer to Table 33.2.The tax structure which leads to maximum income inequality is:

The table below shows the monthly income of a family and the fuel assistance received from the government. Table 33.4 Refer to Table 33.4.What is the marginal penalty on working (in terms of reduced fuel assistance)borne by the family when its income rises from $200 to $300?

If the negative income tax rate is less than 100 percent, the break-even income level will be lower than the poverty level, and families who are officially considered poor will not receive the benefits.

The table below shows the distribution of income in the U.S.in the year 1978. Table 33.1 Refer to Table 33.1.What percentage of income is received by the bottom 20% of the households?

For people who are too well off to receive welfare benefits but who would become eligible for negative income tax payments, the negative income tax might create work disincentives.