Question 1

The top 5 percent of U.S.annual family income in 2003 was $170,082 or more.

Accepted Answer

A) True 
 B)False

Question 2

Which group would be the least upset by wide variation in the income distribution?

Accepted Answer

A)  utilitarians
B)  liberals
C)  libertarians
D)  Each group would be equally upset.E) A) and B)
F) All of the above

Question 3

Which of the following statements is characteristic of utilitarianism?

Accepted Answer

A)  An extra dollar of income provides higher marginal utility to a poor person than to a rich person.
B)  Social policies should be created behind a "veil of ignorance."
C)  Society should strive to maximize the utility of its wealthiest member.
D)  Equality of opportunity is more important than equality of incomes.E) C) and D)
F) A) and B)

Question 4

Scenario 20-1
Suppose that a society is made up of five families whose incomes are as follows:
$120,000; $90,000; $30,000; $30,000; and $18,000.
The federal government is considering two potential income tax plans:
Plan A is a negative income tax plan where the taxes owed equal 1/3 of income minus $20,000.
Plan B is a two-tiered plan where the poverty line is $35,000; families earning over $35,000 pay 10% of their income in taxes, and families earning less than $35,000 pay no income tax.
-Refer to Scenario 20-1.Assuming that utility is directly proportional to the cash value of after-tax income,which government policy would an advocate of liberalism prefer?

Accepted Answer

A)  Plan A
B)  Plan B
C)  either Plan A or Plan B
D)  neither Plan A nor Plan B because any plan that forcibly redistributes income is against the philosophyE) None of the above
F) All of the above

Question 5

Which of the following formulas is most representative of a negative income tax proposal?

Accepted Answer

A)  Taxes Owed = (1/4 of Income)  × $2
B)  Taxes Owed = (1/2 of Income)  × 3/4
C)  Taxes Owed = (1/2 of Income)  + $15,000
D)  Taxes Owed = (1/3 of Income)  - $15,000E) All of the above
F) B) and D)

Question 6

Which of the following will not occur when government policies are enacted to make the distribution of income more equitable?

Accepted Answer

A)  People will alter their behaviors.
B)  Incentives will be distorted.
C)  Total utility will necessarily be constant.
D)  The allocation of resources will be less efficient.E) A) and B)
F) B) and C)

Question 7

Based on U.S.data for 2003,the poverty rate is the highest for which group of people?

Accepted Answer

A)  children
B)  married couples
C)  female households, no spouse present
D)  the elderlyE) None of the above
F) B) and C)

Exam 20: Income Inequality and Poverty

Which of the following statements is characteristic of utilitarianism?

Correct Answer
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Correct Answer
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Which of the following will not occur when government policies are enacted to make the distribution of income more equitable?

Correct Answer
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The top 5 percent of U.S.annual family income in 2003 was $170,082 or more.

Correct Answer
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Which group would be the least upset by wide variation in the income distribution?

Correct Answer
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Which of the following formulas is most representative of a negative income tax proposal?

Correct Answer
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Based on U.S.data for 2003,the poverty rate is the highest for which group of people?

Correct Answer
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Exam 20: Income Inequality and Poverty

Which of the following statements is characteristic of utilitarianism?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following will not occur when government policies are enacted to make the distribution of income more equitable?

Correct AnswerverifiedShow Answer

The top 5 percent of U.S.annual family income in 2003 was $170,082 or more.

Correct AnswerverifiedShow Answer

Which group would be the least upset by wide variation in the income distribution?

Correct AnswerverifiedShow Answer

Which of the following formulas is most representative of a negative income tax proposal?

Correct AnswerverifiedShow Answer

Based on U.S.data for 2003,the poverty rate is the highest for which group of people?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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