Principles of Microeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (12th Edition)
12th Edition
ISBN: 9780134421315
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 1.1P
Subpart (a):
To determine
Identify the sources of income.
Subpart (a):
Expert Solution
Explanation of Solution
Economics Concept Introduction
Concept Introduction:
Transfer payments: Transfer payments are payments made by the government to the people who do not contribute anything in the production process.
Unemployment compensation: Unemployment compensation is a transfer payment of government that pays cash benefits for a certain period of time to laid-off workers who have worked for a specified period of time.
Subpart (b):
To determine
Identify the sources of income.
Subpart (b):
Expert Solution
Explanation of Solution
Dividend from share of stock can be treated as the income earned form property.
Economics Concept Introduction
Concept Introduction:
Property income: Property income is the income earned from the financial holdings and the real property.
Subpart (c):
To determine
Identify the sources of income.
Subpart (c):
Expert Solution
Explanation of Solution
Earing income in the form rent can be treated as the income earned form property.
Economics Concept Introduction
Concept Introduction:
Property income: Property income is the income earned from the financial holdings and the real property.
Subpart (d):
To determine
Identify the sources of income.
Subpart (d):
Expert Solution
Explanation of Solution
Earing income in the form health insurance can be treated as the income earned form wages and salaries in the form of wage supplements.
Economics Concept Introduction
Concept Introduction:
Income from wages and salaries: Income earned from wages and salaries are the portion of personal income.
Subpart (e):
To determine
Identify the sources of income.
Subpart (e):
Expert Solution
Explanation of Solution
Earing income as an administrative assistant can be treated as the income earned form wages and salaries in the form of wage supplements.
Economics Concept Introduction
Concept Introduction:
Income from wages and salaries: Income earned from wages and salaries are the portion of personal income.
Subpart (f):
To determine
Identify the sources of income.
Subpart (f):
Expert Solution
Explanation of Solution
Disability payments received from the social security administration can be considered as the transfer payments.
Economics Concept Introduction
Concept Introduction:
Transfer payments: Transfer payments are payments made by the government to the people who do not contribute anything in the production process.
Want to see more full solutions like this?
Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!
Students have asked these similar questions
In California, a welfare recipient is eligible for welfare benefits of $645. Benefits are reduced by 50
cents for every dollar of earnings. Consider Elizabeth, a resident of California, who can earn $10 per
hour.
a. If she works 10 hours, how much are her earnings, how much is her welfare benefit, and how
much is her income?
b. After Elizabeth works a certain number of hours, she does not receive any benefit at all. What is
that number of hours?
c. Use your answer to parts a and b to plot her budget constraint.
d. Sketch a set of indifference curves consistent with Elizabeth's participating in the labor market
Imagine someone living close to the poverty
line in a developing country. This person runs
a small business filtering and selling water.
Her daughter gets sick, and she has to sell her
filtering machine to pay for treatment. Now
she makes very little money cleaning fish for a
local fishing cooperative. Graph her income
today versus her income tomorrow before her
daughter got sick. Explain your assumptions
with labels on the graph. Then graph what
happens to the equilibrium after her daughter
gets sick. Hint: this is an example of a trap.
Number 6
Chapter 18 Solutions
Principles of Microeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (12th Edition)
Knowledge Booster
Similar questions
- Using the diagram above, which of the following is true? a. In country S the poorest 30 percent of the population receive 13 percent of the available income in country S. b. In country T the richest 10 percent of the population receive 23 percent of the available income in country T. c. In country S the richest 10 percent of the population receive 55 percent of the available income in country S. d. Country S has a more equal distribution of income than does country T. e. None of the above is true.arrow_forwardQuestions and Problems 6. An individual can earn $12 per hour if he or she works. Draw the budget constraints that show the monthly consumption-leisure trade-off under the following three welfare programs. c. The government guarantees $900 per month in income and reduces that benefit by $1 for every $2 in labor income, until the benefit reaches $300 per month. After that point, the government does not reduce the benefit at all.arrow_forwardIn California, a welfare recipient can earn $225 per month without having her benefits reduced. Beyond $225, benefits are reduced by 50 cents for every dollar of earnings. Consider Elizabeth, a resident of California, who can earn $10 per hour. If she does not work at all, she is eligible for welfare benefits of $645. a. If she works 10 hours, how much are her earnings, how much is her welfare benefit, and how much is her income? b. After Elizabeth works a certain number of hours, she does not receive any benefit at all. What is that number of hours? c. Use your answer to parts a and b to plot her budget constraint. d. Sketch a set of indifference curves consis- tent with Elizabeth's participating in the labor market.arrow_forward
- How do Economists define Poverty? 1. Economist define the concept of poverty as an economic state where an individual or household level of income is below a level of annual income necessary to provide a minimum or basic standard of living. 2. The poverty rate is directly related to how income is distributed within a society. Per capita income in 2015 and 2016 is estimated at $56,850 and $62,606, respectively. 3. A minimum standard of living refers to the ability of an individual to acquire food, clothing and housing at an adequate level to avoid economic distress. 4. The U.S. government economists evaluate the cost to individuals and households to acquire food, clothing, and housing to maintain a minimum healthy lifestyle. 5. The bench market for the income level necessary to maintain a basic standard of living is based on USDA Research that uses a baseline cost estimate associated with maintaining a healthy diet of 1800 to 2300 calories per day. * YouTube Q [) 5:09 / 5:37 CC Which…arrow_forwardHow do Economists define Poverty? 1. Economist define the concept of poverty as an economic state where an individual or household level of income is below a level of annual income necessary to provide a minimum or basic standard of living. 2. The poverty rate is directly related to how income is distributed within a society. Per capita income in 2015 and 2016 is estimated at $56,850 and $62,606, respectively. 3. A minimum standard of living refers to the ability of an individual to acquire food, clothing and housing at an adequate level to avoid economic distress. 4. The U.S. government economists evaluate the cost to individuals and households to acquire food, clothing, and housing to maintain a minimum healthy lifestyle. 5. The bench market for the income level necessary to maintain a basic standard of living is based on USDA Research that uses a baseline cost estimate associated with maintaining a healthy diet of 1800 to 2300 calories per day. 5:09 / 5:37 YouTube Q CC Which…arrow_forwardRaka has 80 hours per week that she can allocate to work or leisure. Her job pays a wage rate of $20 per hour, but Raka is being taxed on her income in the following way. On the first $400 that she makes, she pays no tax. That is, for the first 20 hours she works, her net wage—what she takes home after taxes—is $20 per hour. On all income above $400, Raka pays a 75% tax. That is, for all hours above the first 20 hours, her net wage rate is only $5 per hour. Her indifference curves conform to the usual assumptions about consumer preferences. Raka’s optimal choice is to work 30 hours.Draw Raka’s time-allocation budget line for a typical week.arrow_forward
- please label the two questions with the correct answers thank youarrow_forwardQuestion 15 Which of the below statements is INCORRECT with regard to poverty in the U.S.? The poverty threshold was created my Mollie Orshansky of the Social Security Administration, in the 1960s. The "poverty threshold," "poverty guidelines" and "poverty line" are identical numbers and are all used for exactly the same purpose. For the year 2021, a single individual making less than $12,880 in any of the 48 contiguous states, falls below the poverty line. For the year 2021, a four person family making less that $29,200 a year in any of the 48 contiguous states, falls below the poverty line.arrow_forwardPoverty Trap 7. The American Poverty Trap is a phrase used to describe the tendency for individuals below the poverty line to remain there due to the structure of America's safety-net income stabilization programs. 8. The issue is that federal and state benefits decline as a worker goes from being unemployed to becoming fully employed. As earned income increases, the amount of benefits fall. 9. Thus, the marginal benefit of working is increased income, but the marginal cost includes declining benefits, and a loss of leisure time. 10. Federal and state programs are designed so that as the worker nears the poverty line, the increase in income is matched by a decline in benefits. 11. Thus, the worker gains very little by working more! This structure is actually a disincentive to work. 12. What would be a better solution? End all poverty programs? Provide all citizens a poverty level income stipend? What do you think? What have you been told is the way to avoid being trapped in poverty? D…arrow_forward
- how to find the 90/10 income ratio?arrow_forwardIdentify some reasons why household incomes differ. Which factors are the most important?arrow_forwardWhich of the following is NOT one of the reasons for the "welfare state"? Select one: a. Reducing poverty and providing access to healthcare b. Alleviating income inequality c. Alleviating economic insecurity d. Increasing economic equalityarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning