Principles of Economics, 7th Edition (MindTap Course List)
7th Edition
ISBN: 9781285165875
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 20.1, Problem 1QQ
To determine
What does the poverty rate measure and the potential problems in interpreting the measured variable.
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What is poverty and why do we need to measure poverty in the country?
What does the following measure? The percentage of people with an income below a certain level?
O Income inequality
Wealth inequality
O The Gini index
The poverty rate
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What does the Canadian poverty rate measure?
O a. the number of people whose annual household income is less than $17 568
the number of people whose annual household income is less than $21 728
the percentage of people whose income falls below an identified income standard
the percentage of government expenditures allocated to antipoverty programs
O b.
О с.
O d.
Chapter 20 Solutions
Principles of Economics, 7th Edition (MindTap Course List)
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- Describe how each of these changes is likely to affect poverty and inequality: Incomes rise for low-income and high-income workers, but rise more for the high-income earners. Incomes fall for low-income and high-income workers, but fall more for high-income earners.arrow_forwardA group 0f 10 people have the following annual incomes: 24,000,18,000,50,000,100,000,12,000,36,000,80,000,10,000,24,000,16,000. Calculate the share of total income that each quintile receives from this income distribution. Do the top and bottom quintiles in this distribution have a greater or larger share of total income than the top and bottom quintiles of the U.S. income distribution?arrow_forwardWho is included in the top income quintile?arrow_forward
- Explain how a country may experience greater equality in the distribution of income, yet still experience high rates of poverty. Hint: Look at the Clear It Up 'How do governments measure poverty in low-income countries?' and compare to Table 15.5.arrow_forwardThe following table summarizes the income distribution for the town of Perkopia, which has a population of 10,000 people. Every individual within an income group earns the same income, and the total annual income in the economy is $500,000,000. Suppose that in 2007, the poverty line is set at an annual income of $12,700 for an individual. Year Share of Total Income in Perkopia (Percent) Lowest Quintile Second Quintile Middle Quintile Fourth Quintile Highest Quintile 2001 3.0 8.1 14.0 21.5 53.4 2007 3.4 9.0 14.8 22.0 50.8 2013 3.8 9.5 15.4 22.7 48.6 2019 4.0 10.0 16.5 24.0 45.5 The data in the table suggest that there was___________ income inequality from 2001 to 2019. Complete the following table to help you determine the poverty rate in Perkopia in 2007. To do this, begin by determining the total income of all individuals in each quintile using the fact that total annual income in the economy is $500,000,000. Next, determine the…arrow_forward"How can Income Inequality in the United States be Reduced"?arrow_forward
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