Chapter 30 Practice Test (12: Income and Poverty in the U.S.)

A straight-line Lorenz curve shows

an equal distribution of money income.

Which of the following is NOT a correct criticism of the Lorenz curve?

It does not include payments in kind.

It does not deal with differences in family size.

It ignores the impact of age distribution on income distribution.

It refers to money income after taxes.

It refers to money income after taxes.

The distribution of money income can be represented graphically using

a Lorenz curve.

A Lorenz curve that represents an unequal income distribution is

a bowed curved.

The egalitarian principle says

 

that everyone should have exactly the same income.

In the United States, inheritance accounts for roughly ________ of income inequality.

10%

The most common type of investment in human capital is

expanded years of schooling.

• Schooling builds foundational skills, improves employability, and raises lifetime income.

The official number of poor in the United States

is higher today than at any other time in our history.

has risen steadily since 1981.

was lowest in the late 1960s.

is lowest today.

was lowest in the late 1960s.

The purpose of the Supplemental Security Income program is

to provide a minimum income for the aged, blind, and the disabled.

If we include cash benefits and in-kind benefits available to low-income people, the share of the U.S. population in poverty

drops dramatically.

increases somewhat.

increases dramatically.

does not change.

drops dramatically.