Question 1

There is very little economic mobility in the United States, which means that once a family is poor, it is very likely to remain poor for at least a decade.

Accepted Answer

A) True 
 B)False

Question 2

When comparing the percentage of income (or expenditure)  of the lowest and highest 10 percent of the population,

Accepted Answer

A)   South Africa has a more equal income distribution than the United States.
B)   South Africa has a more equal income distribution than Japan.
C)   Japan has a more equal income distribution than the United States.
D)   Mexico has a more equal income distribution than Germany.E) None of the above
F) A) and B)

Question 3

Which of the following is not correct?

Accepted Answer

A)   Poverty is correlated with race.
B)   Poverty is correlated with age.
C)   Poverty is correlated with family composition.
D)   All of the above are correct.E) B) and C)
F) All of the above

Question 4

Critics argue that a disadvantage of the Earned Income Tax Credit is that it does not effectively target the working poor because many recipients are the teenage children of middle-income families.

Accepted Answer

A) True 
 B)False

Question 5

Economists Cox and Alm compared the gap between rich and poor and found that the richest 20% was about 15 times better off than the poorest 20% when they compared what data?

Accepted Answer

The answer of Economists Cox and Alm compared the gap...

Question 6

The measured poverty rate may not reflect the true extent of economic deprivation because it does not include some forms of government assistance.

Accepted Answer

A) True 
 B)False

Question 7

Figure 20-3 
-Refer to Figure 20-3. In 2011, the percent of children under age 18 in poverty is

Accepted Answer

A)   higher than both the percentage of adults aged 18 to 64 and the percentage of elderly aged 65 years and over in poverty.
B)   higher than the percentage of adults aged 18 to 64 but is lower than the percentage of elderly aged 65 years and over in poverty.
C)   lower than both the percentage of adults aged 18 to 64 and the percentage of elderly aged 65 years and over in poverty.
D)   lower than the percentage of adults aged 18 to 64 but is higher than the percentage of elderly aged 65 years and over in poverty.E) A) and D)
F) None of the above

Question 8

The poverty line is

Accepted Answer

A)   established by the federal government.
B)   approximately equivalent to three times the cost of providing an adequate diet.
C)   an absolute level of income below which a family is deemed to be in poverty.
D)   All of the above are correct.E) A) and B)
F) A) and C)

Question 9

When incentives to earn income are distorted by income redistribution programs,

Accepted Answer

A)   losses can exceed potential gains from greater equality of income.
B)   total income in an economy can fall.
C)   total utility in society can fall.
D)   All of the above are correct.E) B) and D)
F) A) and D)

Question 10

The invisible hand of the marketplace acts to allocate resources

Accepted Answer

A)   efficiently but does not necessarily ensure that resources are allocated fairly.
B)   both fairly and efficiently.
C)   fairly but does not necessarily ensure that resources are allocated efficiently.
D)   neither fairly nor efficiently.E) C) and D)
F) B) and D)

Question 11

Which of the following statements about the minimum wage is correct?

Accepted Answer

A)   An increase in the minimum wage enhances the well-being of all unskilled workers.
B)   An increase in the minimum wage has no effect on the well-being of middle-class families.
C)   Advocates of the minimum wage argue that the demand for labor is relatively inelastic.
D)   Critics of the minimum wage argue that it is an undesirable way of helping the poor because it is costly to the government.E) A) and D)
F) A) and C)

Question 12

The study by economists Cox and Alm found that the 2006 after-tax income of the richest fifth of U.S. households is

Accepted Answer

A)   equal to the after-tax income of the poorest fifth.
B)   7 times the after-tax income of the poorest fifth.
C)   14 times the after-tax income of the poorest fifth.
D)   21 times the after-tax income of the poorest fifth.E) B) and C)
F) A) and C)

Question 13

Suppose the average value of in-kind transfers increases by $2,000 from 2013 to 2014. The poverty rate

Accepted Answer

A)   is more likely to understate the true level of poverty.
B)   is more likely to overstate the true level of poverty.
C)   will increase by $2,000 divided by the poverty level.
D)   Both b and c are correct.E) A) and B)
F) B) and D)

Question 14

The maximin criterion is attributed to which political philosophy?

Accepted Answer

A)   utilitarianism
B)   liberalism
C)   libertarianism
D)   repubicanismE) None of the above
F) All of the above

Question 15

The distribution of income for Dismal is as follows: Number of Families Income   1,000 less than $10,000
2,000 between $10,000 and $20,000
2,000 between $20,000 and $30,000
800 between $30,000 and $40,000
200 over $40,000  If the poverty rate in Dismal is about 17 percent, what is the poverty line in Dismal?

Accepted Answer

A)   $10,000.
B)   $20,000.
C)   $30,000.
D)   $40,000.E) B) and C)
F) A) and D)

Question 16

An income distribution may not give an accurate picture of the standard of living for the poor because it does not include in-kind transfers.

Accepted Answer

A) True 
 B)False

Question 17

A utilitarian government will pursue policies that redistribute income from the rich to the poor. One problem with these policies is that

Accepted Answer

A)   everyone has less incentive to work hard.
B)   the rich will work harder while the poor will not.
C)   the poor will work harder while the rich will not.
D)   everyone in the middle class ends up worse off.E) B) and D)
F) B) and C)

Question 18

The United States has more income inequality than Japan, Germany, and France.

Accepted Answer

A) True 
 B)False

Question 19

Table 20-8  Source: U.S. Bureau of Census
-Refer to Table 20-8. Comparing data from 2000 and 2011, which of the following statements is correct?

Accepted Answer

A)   The bottom 40% of the population had a greater share of the income in 2011 than it did in 2001.
B)   The top 40% of the population had a greater share of the income in 2011 than it did in 2001.
C)   The middle 60% of the population had a greater share of the income in 2011 than it did in 2001.
D)   All of the above are correct.E) C) and D)
F) A) and B)

Question 20

Table 20-13
Distribution of Income in Imagination 
-Refer to Table 20-13. If the poverty rate in Imagination is 25%, in what income range on the table is the poverty line?

Accepted Answer

between $1...

Exam 20: Income Inequality and Poverty

A utilitarian government will pursue policies that redistribute income from the rich to the poor. One problem with these policies is that

Correct Answer
verified

Suppose the average value of in-kind transfers increases by $2,000 from 2013 to 2014. The poverty rate

Correct Answer
verified

The study by economists Cox and Alm found that the 2006 after-tax income of the richest fifth of U.S. households is

Correct Answer
verified

When incentives to earn income are distorted by income redistribution programs,

Correct Answer
verified

Which of the following is not correct?

Correct Answer
verified

Which of the following statements about the minimum wage is correct?

Correct Answer
verified

There is very little economic mobility in the United States, which means that once a family is poor, it is very likely to remain poor for at least a decade.

Correct Answer
verified

Figure 20-3 -Refer to Figure 20-3. In 2011, the percent of children under age 18 in poverty is

Correct Answer
verified

Table 20-8 Source: U.S. Bureau of Census -Refer to Table 20-8. Comparing data from 2000 and 2011, which of the following statements is correct?

Correct Answer
verified

The United States has more income inequality than Japan, Germany, and France.

Correct Answer
verified

The maximin criterion is attributed to which political philosophy?

Correct Answer
verified

Correct Answer
verified

When comparing the percentage of income (or expenditure) of the lowest and highest 10 percent of the population,

Correct Answer
verified

The poverty line is

Correct Answer
verified

Critics argue that a disadvantage of the Earned Income Tax Credit is that it does not effectively target the working poor because many recipients are the teenage children of middle-income families.

Correct Answer
verified

Economists Cox and Alm compared the gap between rich and poor and found that the richest 20% was about 15 times better off than the poorest 20% when they compared what data?

Correct Answer
verified

The measured poverty rate may not reflect the true extent of economic deprivation because it does not include some forms of government assistance.

Correct Answer
verified

Table 20-13 Distribution of Income in Imagination -Refer to Table 20-13. If the poverty rate in Imagination is 25%, in what income range on the table is the poverty line?

Correct Answer
verified
between $1...
View Answer

The invisible hand of the marketplace acts to allocate resources

Correct Answer
verified

An income distribution may not give an accurate picture of the standard of living for the poor because it does not include in-kind transfers.

Correct Answer
verified

Exam 20: Income Inequality and Poverty

A utilitarian government will pursue policies that redistribute income from the rich to the poor. One problem with these policies is that

Correct AnswerverifiedShow Answer

Suppose the average value of in-kind transfers increases by $2,000 from 2013 to 2014. The poverty rate

Correct AnswerverifiedShow Answer

The study by economists Cox and Alm found that the 2006 after-tax income of the richest fifth of U.S. households is

Correct AnswerverifiedShow Answer

When incentives to earn income are distorted by income redistribution programs,

Correct AnswerverifiedShow Answer

Which of the following is not correct?

Correct AnswerverifiedShow Answer

Which of the following statements about the minimum wage is correct?

Correct AnswerverifiedShow Answer

There is very little economic mobility in the United States, which means that once a family is poor, it is very likely to remain poor for at least a decade.

Correct AnswerverifiedShow Answer

Figure 20-3 -Refer to Figure 20-3. In 2011, the percent of children under age 18 in poverty is

Correct AnswerverifiedShow Answer

Table 20-8 Source: U.S. Bureau of Census -Refer to Table 20-8. Comparing data from 2000 and 2011, which of the following statements is correct?

Correct AnswerverifiedShow Answer

The United States has more income inequality than Japan, Germany, and France.

Correct AnswerverifiedShow Answer

The maximin criterion is attributed to which political philosophy?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When comparing the percentage of income (or expenditure) of the lowest and highest 10 percent of the population,

Correct AnswerverifiedShow Answer

The poverty line is

Correct AnswerverifiedShow Answer

Critics argue that a disadvantage of the Earned Income Tax Credit is that it does not effectively target the working poor because many recipients are the teenage children of middle-income families.

Correct AnswerverifiedShow Answer

Economists Cox and Alm compared the gap between rich and poor and found that the richest 20% was about 15 times better off than the poorest 20% when they compared what data?

Correct AnswerverifiedShow Answer

The measured poverty rate may not reflect the true extent of economic deprivation because it does not include some forms of government assistance.

Correct AnswerverifiedShow Answer

Table 20-13 Distribution of Income in Imagination -Refer to Table 20-13. If the poverty rate in Imagination is 25%, in what income range on the table is the poverty line?

Correct Answerverifiedbetween $1...View AnswerShow Answer

The invisible hand of the marketplace acts to allocate resources

Correct AnswerverifiedShow Answer

An income distribution may not give an accurate picture of the standard of living for the poor because it does not include in-kind transfers.

Correct AnswerverifiedShow Answer

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between $1...
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