Question 1

Figure 20-2 
-Refer to Figure 20-2. Which of the following is consistent with the data reported in the figure?

Accepted Answer

A)   The female poverty rate is higher for all age groups than the male poverty rate.
B)   The disparity between male and female poverty increases with age.
C)   Neither a nor b are correct.
D)   Both a and b are correct.E) B) and C)
F) A) and B)

Question 2

Which of the following explains the rise in income inequality in the United States from 1970 to 2011?

Accepted Answer

A)   An increase in minimum wages.
B)   An increase in the demand for skilled labor.
C)   An increase in the demand for unskilled labor.
D)   Reduced international trade with low-wage countries.E) B) and C)
F) A) and D)

Question 3

Table 20-11
Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars]  Source: U. S. Bureau of the Census, Current Population Survey.
-Refer to Table 20-11. What is the poverty line for a family of three with one child?

Accepted Answer

A)   $17,595
B)   $18,106
C)   $18,123
D)   $22,891E) None of the above
F) A) and B)

Question 4

Temporary Assistance for Needy Families (TANF) is an example of a negative income tax program.

Accepted Answer

A) True 
 B)False

Question 5

Which philosopher claimed that the government should aim to maximize the well-being of the worst-off person in society?

Accepted Answer

The answer of Which philosopher claimed that the government should...

Question 6

Jermaine believes that it is important to maximize the well-being of the worst-off person in society. He believes in the principle called the .

Accepted Answer

The answer of Jermaine believes that it is important to...

Question 7

The 2011 U.S. distribution of income shows that the top 5 percent of families have approximately what share of income?

Accepted Answer

A)   4 percent
B)   9 percent
C)   21 percent
D)   49 percentE) C) and D)
F) All of the above

Question 8

In the U.S. economy, labor earnings make up about

Accepted Answer

A)   one-half of total income.
B)   two-thirds of total income.
C)   three-fourths of total income.
D)   nine-tenths of total income.E) C) and D)
F) A) and D)

Question 9

What is the term for a measure of happiness or satisfaction a person receives from his or her circumstances?

Accepted Answer

The answer of What is the term for a measure...

Question 10

John Rawls, who developed the way of thinking called liberalism, argued that government policies should be aimed at maximizing the sum of utility of everyone in society.

Accepted Answer

A) True 
 B)False

Question 11

Table 20-4  Source: U.S. Bureau of Census
-Refer to Table 20-4. In 2011, the top fifth of families have

Accepted Answer

A)   almost 13 times as much income as the bottom fifth of families.
B)   28.2% more income than the bottom fifth of families.
C)   50.3% more income than the bottom fifth of families.
D)   45.1% more income than the bottom fifth of families.E) A) and B)
F) A) and C)

Question 12

"The government should choose policies to maximize the total utility of society." This statement is most closely associated with which political philosophy?

Accepted Answer

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

Question 13

In the US, is it more likely that someone will become a millionaire by making money on his/her own or by inheriting a fortune?

Accepted Answer

Making mon...

Question 14

If a father earns 20% above his generation's average income, his son will most likely earn what percent above his generation's average income? What does this statistic indicate?

Accepted Answer

8% Persistence of economic suc...

Question 15

Which of the following statements is not correct?

Accepted Answer

A)   Libertarians are opposed to redistributing income.
B)   Critics of the welfare system argue that it breaks up families.
C)   One of the problems with measuring income inequality is valuing in-kind transfers.
D)   Utilitarians believe that the government should punish crimes but should not redistribute income.E) B) and C)
F) A) and B)

Question 16

Raising total utility is the prime objective of which political philosophy?

Accepted Answer

A)   utilitarianism
B)   liberalism
C)   libertarianism
D)   None of the above is correct.E) A) and B)
F) A) and C)

Question 17

Which of the Ten Principles of Economics do governments run into when they redistribute income to achieve greater equality?

Accepted Answer

A)   Trade can make everyone better off.
B)   The cost of something is what you give up to get it.
C)   People face trade-offs.
D)   Markets are usually a good way to organize economic activity.E) All of the above
F) A) and B)

Question 18

In 2011 the top 20% of income earners accounted for over 80% of all income received by United States' families.

Accepted Answer

A) True 
 B)False

Question 19

The poverty rate is based on a family's

Accepted Answer

A)   income, in-kind transfers, and other government aid.
B)   income and in-kind transfers.
C)   in-kind transfers only.
D)   income only.E) B) and C)
F) None of the above

Question 20

Which of the following statements is correct?

Accepted Answer

A)   The poverty line is a relative standard.
B)   More families are pushed above the poverty line as economic growth pushes the entire income distribution upward.
C)   Increasing income inequality reduces poverty.
D)   Economic growth, by definition, affects all families equally.E) A) and B)
F) B) and C)

Exam 20: Income Inequality and Poverty

John Rawls, who developed the way of thinking called liberalism, argued that government policies should be aimed at maximizing the sum of utility of everyone in society.

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Figure 20-2 -Refer to Figure 20-2. Which of the following is consistent with the data reported in the figure?

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Which of the following statements is not correct?

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Table 20-4 Source: U.S. Bureau of Census -Refer to Table 20-4. In 2011, the top fifth of families have

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Temporary Assistance for Needy Families (TANF) is an example of a negative income tax program.

Correct AnswerverifiedShow Answer

The poverty rate is based on a family's

Correct AnswerverifiedShow Answer

If a father earns 20% above his generation's average income, his son will most likely earn what percent above his generation's average income? What does this statistic indicate?

Correct Answerverified8% Persistence of economic suc...View AnswerShow Answer

What is the term for a measure of happiness or satisfaction a person receives from his or her circumstances?

Correct AnswerverifiedShow Answer

In 2011 the top 20% of income earners accounted for over 80% of all income received by United States' families.

Correct AnswerverifiedShow Answer

"The government should choose policies to maximize the total utility of society." This statement is most closely associated with which political philosophy?

Correct AnswerverifiedShow Answer

The 2011 U.S. distribution of income shows that the top 5 percent of families have approximately what share of income?

Correct AnswerverifiedShow Answer

Jermaine believes that it is important to maximize the well-being of the worst-off person in society. He believes in the principle called the .

Correct AnswerverifiedShow Answer

Which of the following explains the rise in income inequality in the United States from 1970 to 2011?

Correct AnswerverifiedShow Answer

In the US, is it more likely that someone will become a millionaire by making money on his/her own or by inheriting a fortune?

Correct AnswerverifiedMaking mon...View AnswerShow Answer

In the U.S. economy, labor earnings make up about

Correct AnswerverifiedShow Answer

Which of the Ten Principles of Economics do governments run into when they redistribute income to achieve greater equality?

Correct AnswerverifiedShow Answer

Raising total utility is the prime objective of which political philosophy?

Correct AnswerverifiedShow Answer

Which philosopher claimed that the government should aim to maximize the well-being of the worst-off person in society?

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

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Table 20-11 Poverty Thresholds in 2011, by Size of Family and Number of Related Children Under 18 Years [Dollars] Source: U. S. Bureau of the Census, Current Population Survey. -Refer to Table 20-11. What is the poverty line for a family of three with one child?

Correct AnswerverifiedShow Answer

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8% Persistence of economic suc...
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Making mon...
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