Deck 4: Wealth and Income

Question 1

What percentage of American households have incomes of $200,000 or more?

A) 2%
B) 8%
C) 14%
D) 20%

Answer 1

B

Question 2

In 1970, 10% of families were female-headed. Which of the following statements about today's female-headed families is correct?

A) 5% of families are female-headed.
B) 13% of families are female-headed.
C) 18% of families are female-headed.
D) 24% of families are female-headed.

Answer 2

C

Question 3

A tax that takes higher proportions of income at lower income levels is a ______.

A) proscriptive tax
B) progressive tax
C) federal tax
D) regressive tax

Answer 3

D

Question 4

In recent years, poverty rates among the elderly have declined as a result of ______.

A) increases in the stock market
B) their increased participation in the labor force
C) more generous Social Security benefits
D) faith-based initiatives

Question 5

From 1960 to 2000, the labor force participation rate of wives ______.

A) declined
B) doubled
C) tripled
D) quadrupled

Question 6

One year's wages, interest, and dividends, such as might be reported on a federal tax return, are examples of ______.

A) income
B) wealth
C) assets
D) investments

Question 7

The total value of the assets someone owns is referred to as their ______.

A) total worth
B) net worth
C) gross assets
D) net assets

Question 8

Most households derive the greater part of their net worth from what three assets?

A) stocks, bonds, and savings
B) real estate, stocks, and automobile equity
C) bank deposits, home equity, and rare collectibles
D) home equity, automobile equity, and bank deposits

Question 9

Which of the following is one of the three broad classes of wealth holders identified in the text?

A) the homeowner class
B) the nest-egg class
C) the savings class
D) the gig economy class

Question 10

The concentration of wealth at the top is so great that the top 1% now holds more net worth than the bottom ______.

A) 50%
B) 60%
C) 75%
D) 90%

Question 11

A sales tax is an example of a ______.

A) proscriptive tax
B) progressive tax
C) regressive tax
D) restrictive tax

Question 12

For the bottom 40% of households, a significant portion of income comes from government transfers such as ______.

A) Social Security, veterans' benefits, and public assistance
B) Social Security, financial aid, and farm aid
C) children's earnings, extended family support, and Social Security
D) extended family support, Social Security, and public assistance

Question 13

The value of assets owned minus the amount of debt owed is referred to as ______.

A) total worth
B) net worth
C) gross assets
D) net assets

Question 14

Which of the following is NOT a reason that women tend to have higher rates of poverty than men?

A) Women have shorter, less continuous work histories than men.
B) Women generally find themselves in lower paid pink-collar jobs.
C) After marital separation, the economic situation of women deteriorates.
D) Men are not required to pay child support.

Question 15

What is defined as the inflow of money over a period of time?

A) income
B) wealth
C) dividends
D) interest

Question 16

______ and ______ provide most income for most people.

A) Income; dividends
B) Wages; salaries
C) Wages; interest
D) Income; interest

Question 17

This majority of people in this class, hit particularly hard but the Great Recession, have a negative net worth, and few are worth more than $10,000.

A) investor
B) capitalist
C) nearly propertyless
D) nest-egg

Question 18

What is the value of assets held at a point in time?

A) dividends
B) salaries
C) wealth
D) income

Question 19

In what two ways is wealth measured?

A) gross assets; total worth
B) net worth; total worth
C) gross assets; net worth
D) net assets; net worth

Question 20

Most Americans derive the greater part of their net worth from all of these asset types EXCEPT ______.

A) home equity
B) bank deposits
C) car equity
D) interest payments

Question 21

What is the provision of the federal tax code reducing the taxes for low-income families with job earnings?

A) Additional Child Tax Credit
B) Earned Income Tax Credit
C) Additional Standard Deduction
D) Earned Child Tax Credit

Question 22

The ______ class is 10% of households worth more than $1 million and who own most of the privately held investment assets.

A) investor
B) capitalist
C) elite
D) upper-upper

Question 23

What assets are much more concentrated than consumption-oriented assets?

A) publicly traded
B) wealth
C) investment
D) privately held

Question 24

From 2001 to 2013, the average amount of student loan debt among young families rose ______.

A) 20%
B) 35%
C) 50%
D) 70%

Question 25

Wealth can be defined as monetary gain over a specified period of time.

Question 26

The income gap between female- and couple-headed families is less than that between majority and minority families.

Question 27

The federal personal income tax is progressive in its overall effect.

Question 28

The richest fifth claims almost half of all personal income.

Question 29

The economic situation of women tends to improve after a marital separation, whereas that of men deteriorates.

Question 30

Net worth is the value of assets owned minus the amount of debt owed.

Question 31

Roughly one third of Hispanic and Black families have incomes below $35,000.

Question 32

Stocks, bonds, and real estate are the most common types of assets held by Americans.

Question 33

Income is much more highly concentrated than wealth.

Question 34

The concentration of wealth at the top is so great that the top 1% now holds more net worth than the bottom 90%.

Question 35

Most married women still earn less than their partners do, though the gap has been closing.

Question 36

Educational loan debt is increasing at a greater rate than all other debt.

Question 37

Most Americans can expect, at best, a modest inheritance.

Question 38

Transfer payments and noncash benefits raise the living standard of poorer households and dramatically alter the overall structure of economic inequality.

Question 39

Most families hold adequate wealth to support themselves if they missed 3-6 months of paychecks.

Question 40

One year's wages, interest, and dividends are examples of wealth.

Question 41

The poorest fifth pays a significantly higher proportion in taxes to states and localities than does the top 1%.

Question 42

Although the more generous Social Security benefits of recent years have sharply reduced poverty among the elderly, older women living alone continue to have high poverty rates.

Question 43

Wealth is measured in two ways: gross assets and net worth.

Question 44

The majority of the Nearly Propertyless Class have a net worth of more than $10,000 but less than $50,000.

Question 45

List the four factors that have been identified as accounting for the remarkable increases in the number of wealthy families and the concentration of wealth.

Question 46

List two reasons why the economic situation of women tends to become more precarious after divorce, whereas men's tends to improve.

Question 47

Define and distinguish between the three broad classes of wealth holders.

Question 48

What is the difference between the two kinds of wealth: gross assets and net worth?

Question 49

Define progressive and regressive taxes, and explain the difference between the two.