Question 1

Which of the following Gini coefficients represents the income distribution closest to being equal?

Accepted Answer

A) 0.02 
B) 0.10 
C) 0.50 
D) 0.98 
A) 0.02 
B) 0.10 
C) 0.50 
D) 0.98

Question 2

In some countries the tax system is more progressive than in the U.S.What impact does this have on income inequality? What impact do you think this has on entrepreneurial activity?

Accepted Answer

The more progressive the tax system,the

Question 3

Which of the following statements is a correct interpretation of some economists' views?

Accepted Answer

A) When the incomes of the poor are increased, the poor purchase more goods and services, and this causes lower profits. 
B) When the government gives income to the head of a household, other members of the household remain in need. 
C) When the rich do well, the total pie is increased so much that the benefits that trickle down to the poor are greater than the proceeds they would get from redistribution. 
D) When the rich do well, the total pie is decreased, so that the poor are worse off than they were before. 
A) When the incomes of the poor are increased, the poor purchase more goods and services, and this causes lower profits. 
B) When the government gives income to the head of a household, other members of the household remain in need. 
C) When the rich do well, the total pie is increased so much that the benefits that trickle down to the poor are greater than the proceeds they would get from redistribution. 
D) When the rich do well, the total pie is decreased, so that the poor are worse off than they were before.

Question 4

An increase in the tax rate can cause total tax collections to fall if:

Accepted Answer

A) higher taxes cause individuals to substitute leisure for labor. 
B) higher taxes cause individuals to substitute labor for leisure. 
C) the tax is regressive. 
D) the tax is progressive. 
A) higher taxes cause individuals to substitute leisure for labor. 
B) higher taxes cause individuals to substitute labor for leisure. 
C) the tax is regressive. 
D) the tax is progressive.

Question 5

U.S. poverty figures do not include in-kind transfers or underreporting of income.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following statements is true?

Accepted Answer

A) Income distribution became less equal from 1929 to 1970. 
B) Income distribution became less equal from 1970 to today. 
C) The income of the bottom fifth of families rose 10 percent from 1970 to today. 
D) The income of the bottom fifth of families fell 10 percent from 1929 to today. 
A) Income distribution became less equal from 1929 to 1970. 
B) Income distribution became less equal from 1970 to today. 
C) The income of the bottom fifth of families rose 10 percent from 1970 to today. 
D) The income of the bottom fifth of families fell 10 percent from 1929 to today.

Question 7

Refer to the graph shown.   The poorest 50 percent of the families earn:

Accepted Answer

A) 6 percent of the income. 
B) 19 percent of the income. 
C) 36 percent of the income. 
D) 64 percent of the income. 
A) 6 percent of the income. 
B) 19 percent of the income. 
C) 36 percent of the income. 
D) 64 percent of the income.

Question 8

The graph shows that:

Accepted Answer

A) the effect of taxes is to make the distribution of income less equal. 
B) the effect of taxes is to make the distribution of income more equal. 
C) before-tax income and after-tax income are both equally distributed. 
D) taxes are highly regressive. 
A) the effect of taxes is to make the distribution of income less equal. 
B) the effect of taxes is to make the distribution of income more equal. 
C) before-tax income and after-tax income are both equally distributed. 
D) taxes are highly regressive.

Question 9

When measuring income distribution according to class,how does the U.S.compare to most developing countries?

Accepted Answer

The distribution of income according to

Question 10

A Gini coefficient of 1 denotes:

Accepted Answer

A) zero income. 
B) infinite income. 
C) perfect inequality of income distribution. 
D) perfect equality of income distribution. 
A) zero income. 
B) infinite income. 
C) perfect inequality of income distribution. 
D) perfect equality of income distribution.

Question 11

On the Lorenz curve, a perfectly equal distribution of income would be represented by:

Accepted Answer

A) a line with a slope of 1. 
B) a horizontal line. 
C) a vertical line. 
D) an upward-shaped curve. 
A) a line with a slope of 1. 
B) a horizontal line. 
C) a vertical line. 
D) an upward-shaped curve.

Exam 18: Who Gets What the Distribution of Income

Which of the following Gini coefficients represents the income distribution closest to being equal?

In some countries the tax system is more progressive than in the U.S.What impact does this have on income inequality? What impact do you think this has on entrepreneurial activity?

Which of the following statements is a correct interpretation of some economists' views?

An increase in the tax rate can cause total tax collections to fall if:

U.S. poverty figures do not include in-kind transfers or underreporting of income.

Which of the following statements is true?

Refer to the graph shown. The poorest 50 percent of the families earn:

The graph shows that:

When measuring income distribution according to class,how does the U.S.compare to most developing countries?

A Gini coefficient of 1 denotes:

On the Lorenz curve, a perfectly equal distribution of income would be represented by:

Economics and Economic Reasoning

The Production Possibility Model, Trade, and Globalization

Economic Institutions

Supply and Demand

Using Supply and Demand

Describing Supply and Demand: Elasticities

Taxation and Government Intervention

Market Failure Versus Government Failure

Comparative Advantage, Exchange Rates, and Globalization

International Trade Policy

Production and Cost Analysis I

Production and Cost Analysis II

Perfect Competition

Monopoly and Monopolistic Competition

Oligopoly and Antitrust Policy

Real-World Competition and Technology

Work and the Labor Market

The Logic of Individual Choice: the Foundation of Supply and Demand

Game Theory, Strategic Decision Making, and Behavioral Economics

Thinking Like a Modern Economist

Behavioral Economics and Modern Economic Policy

Microeconomic Policy, Economic Reasoning, and Beyond

Economic Growth, Business Cycles, and Unemployment

Measuring and Describing the Aggregate Economy

The Keynesian Short-Run Policy Model: Demand-Side Policies

The Classical Long-Run Policy Model: Growth and Supply-Side Policies

The Financial Sector and the Economy

Monetary Policy

Financial Crises, Panics, and Unconventional Monetary Policy

Deficits and Debt: the Austerity Debate

The Fiscal Policy Dilemma

Jobs and Unemployment

Inflation, Deflation, and Macro Policy

International Financial Policy

Macro Policy in a Global Setting

Structural Stagnation and Globalization

Macro Policy in Developing Countries

Filters