Question 1

One effect of the work requirements of welfare reform has been

Accepted Answer

A) to make the demand curve for welfare upward sloping 
B) to lower the "price" of welfare to recipients 
C) to make the supply curve of welfare upward sloping 
D) to reduce the amount of hassle involved with going on welfare 
E) to raise the "price" of welfare to the recipients 
A) to make the demand curve for welfare upward sloping 
B) to lower the "price" of welfare to recipients 
C) to make the supply curve of welfare upward sloping 
D) to reduce the amount of hassle involved with going on welfare 
E) to raise the "price" of welfare to the recipients E

Question 2

Using the Lorenz curve, the degree of income inequality is measured by

Accepted Answer

A) The line connecting all points for which a given percentage of families receives exactly the cumulative percentage of income 
B) the distance of the Lorenz curve from the line of perfect equality 
C) the flat diagonal line that applies to a perfectly elastic demand curve 
D) the number of times the Lorenz curve crosses the line of perfect equality 
E) is derived by dividing the number of people below the poverty line by the total population 
A) The line connecting all points for which a given percentage of families receives exactly the cumulative percentage of income 
B) the distance of the Lorenz curve from the line of perfect equality 
C) the flat diagonal line that applies to a perfectly elastic demand curve 
D) the number of times the Lorenz curve crosses the line of perfect equality 
E) is derived by dividing the number of people below the poverty line by the total population B

Question 3

The Equal Employment Opportunity Commission

Accepted Answer

A) was established by the Equal Rights Act of 1984 
B) examines cases in which a worker is not paid the same as other workers performing the same work 
C) guarantees a worker's right to a job 
D) established a minimum wage for minorities 
E) has effectively eliminated racial discrimination in the workplace 
A) was established by the Equal Rights Act of 1984 
B) examines cases in which a worker is not paid the same as other workers performing the same work 
C) guarantees a worker's right to a job 
D) established a minimum wage for minorities 
E) has effectively eliminated racial discrimination in the workplace B

Question 4

The social insurance system generally redistributes income from

Accepted Answer

A) rich to poor and from old to young 
B) rich to poor and from young to old 
C) poor to rich and from old to young 
D) poor to rich and from young to old 
E) consumers to producers 
A) rich to poor and from old to young 
B) rich to poor and from young to old 
C) poor to rich and from old to young 
D) poor to rich and from young to old 
E) consumers to producers

Question 5

One of the main tools used by economists to measure the actual distribution of income is

Accepted Answer

A) the Lorenz curve 
B) the Golden Rule 
C) the MR = MC rule 
D) the MRP = MRC rule 
E) the capital / labor ratio 
A) the Lorenz curve 
B) the Golden Rule 
C) the MR = MC rule 
D) the MRP = MRC rule 
E) the capital / labor ratio

Question 6

The distribution of income in the United States is

Accepted Answer

A) more concentrated than the distribution of income in other developed countries throughout the world 
B) significantly more even than the distribution of income in other developed countries throughout the world 
C) quite similar to the distribution of income in other developed countries throughout the world 
D) significantly less even than the distribution of income in most developing countries 
E) quite similar to the distribution of income in most developing countries 
A) more concentrated than the distribution of income in other developed countries throughout the world 
B) significantly more even than the distribution of income in other developed countries throughout the world 
C) quite similar to the distribution of income in other developed countries throughout the world 
D) significantly less even than the distribution of income in most developing countries 
E) quite similar to the distribution of income in most developing countries

Question 7

The distribution of income among African-American families is more even than it is for the population as a whole.

Accepted Answer

A) True 
 B)False

Question 8

Measurement of the official poverty level

Accepted Answer

A) includes all transfers 
B) excludes all transfers 
C) includes cash transfers but not in-kind transfers 
D) includes in-kind transfers but not cash transfers 
E) is always measured in real rather than nominal terms 
A) includes all transfers 
B) excludes all transfers 
C) includes cash transfers but not in-kind transfers 
D) includes in-kind transfers but not cash transfers 
E) is always measured in real rather than nominal terms

Question 9

The Food Stamp program provides

Accepted Answer

A) quality labels on food 
B) cash transfers to the poor 
C) cash transfers to the elderly 
D) vouchers that can be redeemed for food 
E) food deliveries to the elderly 
A) quality labels on food 
B) cash transfers to the poor 
C) cash transfers to the elderly 
D) vouchers that can be redeemed for food 
E) food deliveries to the elderly

Question 10

In a market economy, household income is determined primarily by

Accepted Answer

A) the age of the head of household 
B) the gender of the head of household 
C) luck 
D) the productivity of labor resources 
E) government transfer payments 
A) the age of the head of household 
B) the gender of the head of household 
C) luck 
D) the productivity of labor resources 
E) government transfer payments

Question 11

The official poverty level in the United States

Accepted Answer

A) has been the same since 1980 
B) is the same as in other developed countries because it is based on a United Nations definition 
C) is defined by the United Nations 
D) is defined by the Department of Agriculture and based on food costs 
E) has been adjusted for inflation but not for changes in family size 
A) has been the same since 1980 
B) is the same as in other developed countries because it is based on a United Nations definition 
C) is defined by the United Nations 
D) is defined by the Department of Agriculture and based on food costs 
E) has been adjusted for inflation but not for changes in family size

Question 12

Exhibit 18-1   Exhibit 18-1 shows five different Lorenz curves.Which curve shows the most equal distribution of income?

Accepted Answer

A) a 
B) b 
C) c 
D) d 
E) e 
A) a 
B) b 
C) c 
D) d 
E) e

Question 13

Of the following, who would probably have the highest income?

Accepted Answer

A) a couple, both of whom have high school educations and work at WalMart 
B) a husband who has a high school degree and a middle-management job and his wife, who is a full-time mother 
C) a couple, both of whom have high school educations; he is a high school teacher and she is a librarian 
D) a husband who has a college degree and is a high school teacher and his wife, who has an MBA and works as a insurance company executive 
E) a couple, both of whom have college degrees and are high school teachers 
A) a couple, both of whom have high school educations and work at WalMart 
B) a husband who has a high school degree and a middle-management job and his wife, who is a full-time mother 
C) a couple, both of whom have high school educations; he is a high school teacher and she is a librarian 
D) a husband who has a college degree and is a high school teacher and his wife, who has an MBA and works as a insurance company executive 
E) a couple, both of whom have college degrees and are high school teachers

Question 14

One reason the U.S.government is sensitive to demands by the elderly is that the elderly have higher voter participation rates than members of other age groups.

Accepted Answer

A) True 
 B)False

Question 15

In less developed economies, the distribution of income is

Accepted Answer

A) more concentrated (i.e., distributed less evenly)than in developed economies 
B) less concentrated than in developed economies 
C) such that the bottom 20 percent of households define the poverty threshold 
D) such that the top 20 percent of households define the poverty threshold 
E) completely even 
A) more concentrated (i.e., distributed less evenly)than in developed economies 
B) less concentrated than in developed economies 
C) such that the bottom 20 percent of households define the poverty threshold 
D) such that the top 20 percent of households define the poverty threshold 
E) completely even

Question 16

Most people on welfare

Accepted Answer

A) are not U.S.citizens 
B) are poorly educated and have few job skills 
C) do not qualify for food stamps, child care, or Medicaid 
D) have jobs 
E) are below the age of 16 
A) are not U.S.citizens 
B) are poorly educated and have few job skills 
C) do not qualify for food stamps, child care, or Medicaid 
D) have jobs 
E) are below the age of 16

Question 17

Which of the following occurs last in the sequence?

Accepted Answer

A) A power couple has children 
B) At the best colleges, the now grown children meet their future spouses 
C) A power couple marries 
D) With a head start in life, many of the children go to the best colleges 
E) The children benefit from the high income and genetic endowment passed along from their well-educated parents 
A) A power couple has children 
B) At the best colleges, the now grown children meet their future spouses 
C) A power couple marries 
D) With a head start in life, many of the children go to the best colleges 
E) The children benefit from the high income and genetic endowment passed along from their well-educated parents

Question 18

The most effective government policy for reducing poverty is to

Accepted Answer

A) reduce discrimination in the job market based on gender and race 
B) abandon all government programs and rely on private charity 
C) reduce programs that promote education and training of the poor 
D) dramatically increase Medicare payments to the elderly 
E) promote economic growth and job creation 
A) reduce discrimination in the job market based on gender and race 
B) abandon all government programs and rely on private charity 
C) reduce programs that promote education and training of the poor 
D) dramatically increase Medicare payments to the elderly 
E) promote economic growth and job creation

Question 19

Transfer programs that do not tie benefits to contributions are called

Accepted Answer

A) social insurance programs 
B) income assistance programs 
C) health aid programs 
D) bonus programs 
E) compensation programs 
A) social insurance programs 
B) income assistance programs 
C) health aid programs 
D) bonus programs 
E) compensation programs

Question 20

Which of the following is not "means-tested"?

Accepted Answer

A) Temporary Assistance for Needy Families (TANF) 
B) welfare programs 
C) the Food Stamp program 
D) Social Security payments to a retiree 
E) free and reduced price school lunches for the poor 
A) Temporary Assistance for Needy Families (TANF) 
B) welfare programs 
C) the Food Stamp program 
D) Social Security payments to a retiree 
E) free and reduced price school lunches for the poor

Exam 18: Income Distribution and Poverty

One effect of the work requirements of welfare reform has been

Using the Lorenz curve, the degree of income inequality is measured by

The Equal Employment Opportunity Commission

The social insurance system generally redistributes income from

One of the main tools used by economists to measure the actual distribution of income is

The distribution of income in the United States is

The distribution of income among African-American families is more even than it is for the population as a whole.

Measurement of the official poverty level

The Food Stamp program provides

In a market economy, household income is determined primarily by

The official poverty level in the United States

Exhibit 18-1 Exhibit 18-1 shows five different Lorenz curves.Which curve shows the most equal distribution of income?

Of the following, who would probably have the highest income?

One reason the U.S.government is sensitive to demands by the elderly is that the elderly have higher voter participation rates than members of other age groups.

In less developed economies, the distribution of income is

Most people on welfare

Which of the following occurs last in the sequence?

The most effective government policy for reducing poverty is to

Transfer programs that do not tie benefits to contributions are called

Which of the following is not "means-tested"?

The Art and Science of Economic Analysis

Appendix--Understanding Graphs

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Elasticity of Demand and Supply

Appendix--Price Elasticity and Tax Incidence

Consumer Choice and Demand

Appendix--Indifference Curves and Utility Maximization

Production and Cost in the Firm

A--Perfect Competition

B--Perfect Competition

A--Monopoly

B--Monopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, Interest, and Corporate Finance

Transaction Costs, Imperfect Information, and Behavioral Economics

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

International Trade

International Finance

Economic Development

Filters