Problem 1
Suppose that the United States has a Gini ratio of 0.41 while Sweden has a Gini ratio of 0.3 1. Which country has a more equal distribution of income? a. The United States. b. Sweden. c. They are actually equal.
Problem 2
Some part of income inequality is likely to be the result of discrimination. But other factors responsible for inequality include (select as many as apply): a. Differences in abilities and talents. b. Differences in education and training. c. Different preferences for work versus leisure. d. Different preferences for low-paying but safe jobs relative to high-paying but dangerous jobs.
Problem 3
Suppose that a society contains only two members, a lawyer named Monique and a handyman named James. Five years ago, Monique made \(\$ 100,000\) while James made \(\$ 50,000\). This year, Monique will make \(\$ 300,000\) while James will make \(\$ 100,000 .\) Which of the following statements about this society's income distribution are true? Select one or more answers from the choices shown. a. In absolute dollar amounts, the entire distribution of income has been moving upward. b. In absolute dollar amounts, the entire distribution of income has been stagnant. c. The relative distribution of income has become more equal. d. The relative distribution of income has become less equal. e. The relative distribution of income has remained constant. f. The rich are getting richer while the poor are getting poorer. g. The rich are getting richer faster than the poor are
Problem 4
Suppose that the last dollar that Victoria receives as income brings her a marginal utility of 10 utils while the last dollar that Fredrick receives as income brings him a marginal utility of 15 utils. If our goal is to maximize the combined total utility of Victoria and Fredrick, we should: a. Redistribute income from Victoria to Fredrick. b. Redistribute income from Fredrick to Victoria. c. Not engage in any redistribution because the current situation already maximizes total utility. d. None of the above.
Problem 5
If women are crowded into elementary education and away from fire fighting, wages in fire fighting will tend to be___________________than if women weren't crowded into elementary education. a. Higher. b. Lower.
Problem 6
In the taste-for-discrimination model, an increase in employer prejudice against African-American workers would cause the discrimination coefficient to_______________________ and the demand curve for African-American labor to shift__________________________. a. Decrease; right. b. Decrease; left. c. Increase; right. d. Increase; left.
