Question 1

A tax provision that works much like a negative income tax is the

Accepted Answer

A)  Earned Income Tax Credit (EIT
C)  .
B)  Temporary Assistance for Needy Families (TANF) .
C)  deduction for charitable contributions.
D)  mortgage interest rate deduction.E) A) and B)
F) None of the above

Question 2

The goal of utilitarians is to

Accepted Answer

A)  punish crimes and enforce voluntary agreements but not to redistribute income.
B)  redistribute income until each person has equal earnings.
C)  redistribute income until the marginal utility of the wealthiest person equals the total utility of the poorest person.
D)  redistribute income based on the assumption of diminishing marginal utility.E) C) and D)
F) A) and B)

Question 3

The marketplace allocates resources

Accepted Answer

A)  fairly.
B)  efficiently.
C)  to those desiring them least.
D)  both efficiently and equitably.E) All of the above
F) A) and C)

Question 4

Based on data from 2011, the top fifth of all families received approximately what percent of all income in the United States?

Accepted Answer

A)  83 percent
B)  49 percent
C)  41 percent
D)  21 percentE) A) and B)
F) A) and C)

Question 5

Which of the following is most likely to occur when the government enacts policies to make the distribution of income more equal?

Accepted Answer

A)  a more efficient allocation of resources
B)  a distortion of incentives
C)  unchanged behavior
D)  All of the above are correct.E) A) and B)
F) None of the above

Question 6

Supporters of raising the minimum wage argue that minimum-wage laws are

Accepted Answer

A)  a tax-free way to help the working poor. Businesses bear the burden of paying higher wages, not the government.
B)  better than the Earned Income Tax Credit (EIT
C)   in targeting the working poor. The EITC may benefit teenagers from middle-class families who work summer jobs at the minimum wage.
C)  better than in-kind transfers such as food stamps in providing food rather than unhealthy items such as drugs or alcohol.
D)  a way to increase employment of those likely to earn the minimum wage.E) All of the above
F) A) and B)

Question 7

Suppose society consists of four individuals: Andy, Bill, Carl, and David. Andy has $20,000 of income, Bill has $40,000 of income, Carl has $60,000 of income, and David has $80,000 of income. A utilitarian would argue that

Accepted Answer

A)  taking $1 from Bill and giving it to Carl would increase society's total utility.
B)  taking $1 from Carl and giving it to Andy would increase society's total utility.
C)  taking $1 from Carl and giving it to David would increase society's total utility.
D)  taking $1 from Bill and giving it to David would increase society's total utility.E) B) and D)
F) B) and C)

Question 8

Which of the following statements is not correct?

Accepted Answer

A)  Two key elements of welfare reform are work requirements and limiting the time that recipients can receive benefits.
B)  The Earned Income Tax Credit (EIT
C)   is very similar to a negative income tax.
C)  Minimum wage laws will likely increase unemployment.
D)  The elderly are more likely to be poor than single mothers.E) B) and C)
F) All of the above

Question 9

Of the following countries, which has the most equal distribution of income? United States, Brazil, Mexico, China, Japan, Germany, United Kingdom, Russia

Accepted Answer

The answer of Of the following countries, which has the...

Question 10

An example of a transitory change in income is the

Accepted Answer

A)  annual cost of living adjustment to your salary.
B)  increase in income that results from a job promotion linked to your education.
C)  increase in income of California orange growers that results from an orange-killing frost in Florida.
D)  All of the above are correct.E) B) and C)
F) A) and D)

Question 11

Table 20-3
The Distribution of Income in Edgerton 
-Refer to Table 20-3. Where would the government in Edgerton set the poverty line to have a poverty rate of 40 percent?

Accepted Answer

A)  $28,000
B)  $44,000
C)  $76,000
D)  $88,000E) A) and B)
F) A) and D)

Question 12

Which of the following is not an example of in-kind transfers?

Accepted Answer

A)  food stamps
B)  Medicaid
C)  the Earned Income Tax Credit
D)  housing vouchersE) B) and C)
F) A) and D)

Question 13

Which of the following statements is not correct?

Accepted Answer

A)  The poverty line is an absolute level of income set by the federal government below which a family is considered to be in poverty.
B)  The poverty line is approximately equal to three times the cost of providing an adequate diet.
C)  The poverty line is adjusted annually to reflect changes in price levels.
D)  The poverty line is adjusted semiannually to reflect changes in fuel prices.E) A) and D)
F) B) and D)

Question 14

Table 20-15
Income Inequality in 2010 in the United States by Race
The values in the table reflect the percentages of pre-tax-and-transfer income.  Source: US Census Bureau
-Refer to Table 20-15. In percentage point terms, how much more did the top 5% of the Asian population earn than it would have if income were distributed equally?

Accepted Answer

The answer of Table 20-15
Income Inequality in 2010 in the...

Question 15

A family's ability to buy goods and services depends largely on its

Accepted Answer

A)  permanent income, which is its normal, or average, income.
B)  permanent income, which is the lowest annual income the family has received over a 10-year period.
C)  transitory income, which is the measure of income used by the government to analyze the distribution of income and the poverty rate.
D)  transitory income, which is its money income plus any in-kind transfers it receives.E) A) and B)
F) A) and C)

Question 16

"Equality of opportunities is more important than equality of incomes." This statement would be most likely attributed to which political philosophy?

Accepted Answer

A)  utilitarianism
B)  liberalism
C)  libertarianism
D)  welfarismE) B) and C)
F) A) and D)

Question 17

The income distribution in the United States shows that the income share of the top fifth of all families is

Accepted Answer

A)  over 60 percent.
B)  around 21 percent.
C)  more than 12 times the income of the bottom fifth.
D)  less than 10 times the income of the bottom fifth.E) B) and D)
F) B) and C)

Question 18

Poor families are eligible for financial assistance, without having to demonstrate any additional "need,"

Accepted Answer

A)  under the current welfare system and under a negative income tax.
B)  under the current welfare system but not under a negative income tax.
C)  under a negative income tax but not under the current welfare system.
D)  under neither the current welfare system nor under a negative income tax.E) C) and D)
F) A) and C)

Question 19

The philosopher John Rawls argued that

Accepted Answer

A)  people would choose a more equal distribution of income if they had to determine an economic distribution system before knowing their place in it.
B)  people would choose income inequality to allow the maximum use of their individual talents.
C)  government has a role to ensure income equality to prevent social unrest.
D)  people would choose equal opportunity because it is morally right.E) A) and B)
F) All of the above

Question 20

Which of the following is not correct?

Accepted Answer

A)  A negative income tax only applies to working people, so it encourages people to get full-time work.
B)  Supporters advocate the use of the Earned Income Tax Credit as a way to help the working poor.
C)  A negative income tax subsidizes the incomes of poor people.
D)  An advantage of a negative income tax is that it is not based on the number of children, so it does not provide incentives for unmarried women to have children.E) None of the above
F) A) and B)

Exam 20: Income Inequality and Poverty

Which of the following statements is not correct?

Correct Answer
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Which of the following is not an example of in-kind transfers?

Correct Answer
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Table 20-3 The Distribution of Income in Edgerton -Refer to Table 20-3. Where would the government in Edgerton set the poverty line to have a poverty rate of 40 percent?

Correct Answer
verified

A tax provision that works much like a negative income tax is the

Correct Answer
verified

Supporters of raising the minimum wage argue that minimum-wage laws are

Correct Answer
verified

Which of the following statements is not correct?

Correct Answer
verified

Suppose society consists of four individuals: Andy, Bill, Carl, and David. Andy has $20,000 of income, Bill has $40,000 of income, Carl has $60,000 of income, and David has $80,000 of income. A utilitarian would argue that

Correct Answer
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The philosopher John Rawls argued that

Correct Answer
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"Equality of opportunities is more important than equality of incomes." This statement would be most likely attributed to which political philosophy?

Correct Answer
verified

Based on data from 2011, the top fifth of all families received approximately what percent of all income in the United States?

Correct Answer
verified

A family's ability to buy goods and services depends largely on its

Correct Answer
verified

Which of the following is not correct?

Correct Answer
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Poor families are eligible for financial assistance, without having to demonstrate any additional "need,"

Correct Answer
verified

An example of a transitory change in income is the

Correct Answer
verified

The income distribution in the United States shows that the income share of the top fifth of all families is

Correct Answer
verified

The marketplace allocates resources

Correct Answer
verified

Correct Answer
verified

The goal of utilitarians is to

Correct Answer
verified

Of the following countries, which has the most equal distribution of income? United States, Brazil, Mexico, China, Japan, Germany, United Kingdom, Russia

Correct Answer
verified

Which of the following is most likely to occur when the government enacts policies to make the distribution of income more equal?

Correct Answer
verified

Exam 20: Income Inequality and Poverty

Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Which of the following is not an example of in-kind transfers?

Correct AnswerverifiedShow Answer

Table 20-3 The Distribution of Income in Edgerton -Refer to Table 20-3. Where would the government in Edgerton set the poverty line to have a poverty rate of 40 percent?

Correct AnswerverifiedShow Answer

A tax provision that works much like a negative income tax is the

Correct AnswerverifiedShow Answer

Supporters of raising the minimum wage argue that minimum-wage laws are

Correct AnswerverifiedShow Answer

Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Suppose society consists of four individuals: Andy, Bill, Carl, and David. Andy has $20,000 of income, Bill has $40,000 of income, Carl has $60,000 of income, and David has $80,000 of income. A utilitarian would argue that

Correct AnswerverifiedShow Answer

The philosopher John Rawls argued that

Correct AnswerverifiedShow Answer

"Equality of opportunities is more important than equality of incomes." This statement would be most likely attributed to which political philosophy?

Correct AnswerverifiedShow Answer

Based on data from 2011, the top fifth of all families received approximately what percent of all income in the United States?

Correct AnswerverifiedShow Answer

A family's ability to buy goods and services depends largely on its

Correct AnswerverifiedShow Answer

Which of the following is not correct?

Correct AnswerverifiedShow Answer

Poor families are eligible for financial assistance, without having to demonstrate any additional "need,"

Correct AnswerverifiedShow Answer

An example of a transitory change in income is the

Correct AnswerverifiedShow Answer

The income distribution in the United States shows that the income share of the top fifth of all families is

Correct AnswerverifiedShow Answer

The marketplace allocates resources

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The goal of utilitarians is to

Correct AnswerverifiedShow Answer

Of the following countries, which has the most equal distribution of income? United States, Brazil, Mexico, China, Japan, Germany, United Kingdom, Russia

Correct AnswerverifiedShow Answer

Which of the following is most likely to occur when the government enacts policies to make the distribution of income more equal?

Correct AnswerverifiedShow Answer

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