Economic Inequality

2. 20 Economic Inequality CLICKER QUESTIONS

3. Checkpoint 20.3 Checkpoint 20.1 Checkpoint 20.2 Question 8 Question 1 Question 4 Question 9 Question 5 Question 2 Question 10 Question 6 Question 3 Question 7

4. CHECKPOINT 20.1 Question 1 In the figure, the richest 20 percent of households receive ____ percent of total income. • 20 • 100 • 80 • 40 • 60

5. CHECKPOINT 20.1 Question 2 In the United States, ______. • income is equally distributed • wealth is equally distributed • income is equally distributed, but wealth is unequally distributed because of inheritances • both wealth and income are unequally distributed • both wealth and income are equally distributed

6. CHECKPOINT 20.1 Question 3 The inequality of annual market income ________. • overstates the degree of lifetime inequality • understates the degree of lifetime inequality • cannot change from one year to the next • is about the same as the amount of lifetime inequality • cannot be compared to the amount of lifetime inequality

7. CHECKPOINT 20.2 Question 4 At any given employment level, the gap between the wage rates that firms are willing to pay low-skilled and high-skilled workers measures the ______. • equilibrium wage differential • cost of acquiring a skill • value of marginal product of skill • willingness of high-skilled workers to take a job • value that high-skilled workers place on leisure

8. CHECKPOINT 20.2 Question 5 An increase in the cost of acquiring a skill _______. • lowers the value of marginal product of high-skilled labor • increases the willingness of firms to hire high-skilled labor • decreases the supply of high-skilled labor • raises the equilibrium wage rate paid to low-skilled labor • lowers the equilibrium wage differential between high- skilled and low-skilled labor

9. CHECKPOINT 20.2 Question 6 The figure shows supply and demand curves for high-skilled and low-skilled labor. The wage rate paid high-skilled workers is ____, and the wage rate paid low-skilled workers is ____. • $14 an hour; $10 an hour • $16 an hour; $14 an hour • $14 an hour; $10 an hour • $16 an hour; 10 an hour • $16 an hour; $8 an hour

10. CHECKPOINT 20.2 Question 7 Differences in skills ________. • arise from education and on-the-job training • lead to difference in the value of marginal product of labor • lead to a greater supply of high-skilled workers than low-skilled workers • Options A and B are correct. • Options A, B, and C are correct.

11. CHECKPOINT 20.3 Question 8 Using taxes as a redistribution method, a ________ tax provides the greatest amount of redistribution from people who earn high incomes to people who earn low incomes. • progressive income • proportional income • regressive income • flat-rate income • sales

12. CHECKPOINT 20.3 Question 9 The three major types of income maintenance programs are ______. • Social Security programs, unemployment compensation, and welfare programs • food stamps, unemployment compensation, and agricultural price supports • student loans, rent control, and welfare programs • corporate bailouts, minimum wages, and affirmative action laws • minimum wages, food stamps, and student loans

13. CHECKPOINT 20.3 Question 10 With a negative income tax scheme that has a $10,000 guaranteed minimum income and a 25 percent tax rate, a household that has earned income of $16,000 has a total income of _______. • $16,000 • $22,000 • $26,000 • $24,000 • $10,000