FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 20: Income Inequality and Poverty

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 81

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following statements is correct?

A) The distribution of annual income accurately reflects the distribution of living standards.
B) Permanent incomes are more equally distributed than annual incomes.
C) Transitory changes in income generally have a significant impact on a family's standard of living.
D) Annual income is more equally distributed than permanent income.

Correct Answer

verified

Show Answer

Question 82

Multiple Choice

Review LaterAdd Note

Review Later

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

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.

Correct Answer

verified

Show Answer

Question 83

True/False

Review LaterAdd Note

The poverty rate is an absolute level of income set by the federal government for each family size. A family with income below this rate is deemed to be in poverty.

A negative income tax system would

Economists study poverty and income inequality to answer which of the following questions?

The United States has a more unequal income distribution than many other developed countries such as Japan and Germany.

Even though the average income in the United States has continued to grow, the poverty rate has increased to over 20% since the early 1970s.

Which of the following statements is correct?

A society consists of three individuals: Ellie, Hakeem, and Piper. In terms of income and utility, Ellie is currently best-off, Hakeem ranks in the middle, and Piper is worst-off. Which of the following statements is correct?

Explain the concept of diminishing marginal utility, and describe the role that it plays in the utilitarian argument for the redistribution of income.

Which of the following statements is not correct?

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 .

Compare and contrast the "life cycle" hypothesis and the "permanent income" hypothesis. What are their respective implications for inequality in the income distribution?

Of the following four countries, which has the highest degree of income inequality?

A U.S. family earning $80,000 would be in the top 20 percent of income distribution in 2011.

Which political philosophy believes that the government should equalize the incomes of all members of society?

Scenario 20-5 Zooey is a single mother of two young children whose husband died in a tragic car accident. She earns $20,000 per year working as a cashier at a grocery store. The government uses a negative income tax system in which Taxes owed = (1/4 of income) - $15,000. -Refer to Scenario 20-5. One of Zooey's friends tells her she would have more money for the year if she quit her job and filed her tax return with $0 in income. Is her friend correct? Why or why not?

A goal of libertarians is to provide citizens with equal opportunities rather than to ensure equal outcomes.

Briefly describe the three prominent schools of thought in political philosophy. Identify one of the most well-known philosophers in each school.

Table 20-1 The following table shows the distribution of income in Choochooville. ​ ​ $\begin{array} { | c | c | } \hline \text { Group } & \text { Annual Family Income } \\\hline \text { Bottom Quartile } ( 25 \% ) & \$ 23,000 \text { and below } \\\hline \text { Third Quartile } & \$ 23,000 \text { to } \$ 52,999 \\\hline \text { Second Quartile } & \$ 53,000 \text { to } \$ 82,999 \\\hline \text { Top Quartile } & \$ 83,000 \text { and above } \\\hline\end{array}$ ​ -Refer to Table 20-1. If the poverty line were $37,448, what would be the poverty rate?