EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 21, Problem 7DQ
To determine
The distribution of the income.
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Which would be evidence of an increase in income inequality over time in the United
States?
O a decrease in the percentage of total personal income received by the highest quintile
O an increase in the percentage of total personal income received by the highest quintile
O an increase in the percentage of total personal income received by the four lowest quintiles
O an increase in the percentage of total personal income received by the lowest quintile
As income transfer programs accompanying the War on Poverty increased beginning in the latter half of the 1960s, what happened to poverty in the
United States? Check all that apply.
O The adjusted poverty rate has declined rapidly and is now less than half of the official poverty rate.
O The poverty rate declined substantially in the period before the War on Poverty, but not in the period after the start of the War on
Poverty.
O In 2018, the adjusted poverty rate was only 4 percentage points lower than the official rate in 1970.
O The War on Poverty has been largely ineffective in reducing the rate of poverty in the United States.
%24
A household with income that is two-thirds of the poverty threshold has ratio of income to poverty of
O 0.67.
O 1.50.
O 3.20.
O0.23.
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Chapter 21 Solutions
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- "Growth and improvement in inequality are important to alleviate poverty.' а. Examine any FOUR (4) factors that can influence poverty eradication and income distribution in Malaysia. [12 marks] b. Describe any FOUR (4) factors that affect the income distribution in Malaysia.arrow_forward(a) unemployment in the originating nation, (b) remittances * How might the output and income gains from immigration shown by the simple immigration model be affected by themployment in the originating nation, (b) remittances inmigrants to the home country, and (c) backflows of migrants to the home country? LO23.3 migrants to the home country? LO23.3 shown by the simple immigration model be affected byarrow_forwardThe government announces programs designed to reduce the share of income going to the top quintile from 60% to 20%. You predict that the most likely result is that: O mean household income will fall, because the highest income earners will earn less and work less. median household income will rise, because some of the 40% of redistributed income will be transferred to the third quintile. after redistribution, each quintile will receive 20% of total wealth. O the lowest quintile will receive the 40% taken from the top quintile and switch places.arrow_forward
- Completed 15 out of 20 Submit All Question 9 of 20 If the poverty guideline for a family of four is $25,750, what is the most that a household can earn to be considered "near- poor"? O $19,312.50 O $12,875 O $32,187.50 O $25,750arrow_forwardQ7.1) The following question refers to income inequality and the Lorenz curve. Answer the question below: - Does it matter if some people are much richer than others?- Who are the top 1 percent in income and what are the effects of demography on socialinequality in various regions of the world today?- Why has income inequality worsened?- Does wealth distribution follow a similar pattern from generation to generation? What do experts say is the best way to shrink the wealth gap?arrow_forwardYou have been provided with the following statement: “According to the World Bank, South Africa remains a dual economy with one of the highest inequality rates in the world, with a Gini Coefficient of 0.643.” address in depth in your brief: A good, understandable definition of the Gini Coefficient. Indicate the significance of the South African Gini coefficient in relation to Gini coefficient ranges associated with equal and unequal income distributions; • Explain how the Gini coefficient is derived from the Lorenz curve by making use of the graph provided;arrow_forward
- 3) True or False questions: a) Two countries can have the same level of GDP and population size, but different levels of Inequality. b) Two countries can have different levels of GDP and population size, but the same level of inequality. c): The ethical principles of inequality measurement (anonymity, population, relative income and Dalton transfers) are enough to compare any two income distributions in terms of relative inequality. [Hint: consider part e) in question 1 above] To mlate the GIarrow_forwardConsider the following table that gives the monthly per capita consumption expenditure of 10 households with poverty line given as $500 per month. Poverty Gap is %. Monthly per capita consumption expenditure (in $) of 10 households 5 400 300 1000 2500 4 9 400 950 2 3 6 7 8 10 Country A 900 1200 505 100 O a 40 O b. 13 O c. 27 O d. 16arrow_forwardThe area between the Lorenz curve of a country and the diagonal of perfect equality represents: O A. the area of equality. ОВ. the area of inequality. C. The Gini coefficient. O D. The quantile ratio. O E. the cumulative percentage of the population.arrow_forward
- Do you agree or disagree? Explain your reasoning. “There need be no trade-off between equality and efficiency. An ‘efficient’ economy that yields an income distribution that many regard as unfair may cause those with meager incomes to become discouraged and stop trying. So efficiency may be undermined. A fairer distribution of rewards may generate a higher average productive effort on the part of the population, thereby enhancing efficiency. If people think they are playing a fair economic game and this belief causes them to try harder, an economy with an equitable income distribution may be efficient as well.arrow_forwardShow instructions Question 1 Income poverty is about the lack of access to the basic rights of food, clothes and shelter, education, proper health care, clean water -- rights that most of us take for grante ○ True O False Question 2 ( Population is not a direct cause of poverty, but it does compound the problem of poverty. True O False Question 3 Income levels do not necessarily reflect levels of poverty. O True O False Questions 1-10 of 10 | Page 1 of 1 Question 4 War is perhaps the most devastating and serious cause of poverty. O True O False Question 5 The World Bank has established an international poverty line of $10 a day per person in 1985 purchasing power parity (PPP) prices. O True O False Question 6 Analysts have found a strong positive relationship between economic growth and poverty reduction. O True O False Question 7 Most of the world's poor live in South Asia. True O Falsearrow_forwardPlease answer based on information above. Would this transfer increase, decrease, or have no effect on income inequality in this group? Redistributing income from the highest earner to the lowest one would reduce the utility of the top earner and increase the utility of the lowest earner. But what would happen to overall utility in the economy? Would it increase, decrease, or remain the same? Explain your answer. (Hint: does the marginal utility of income diminish as one earns more?)arrow_forward
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