Economics: Private and Public Choice
16th Edition
ISBN: 9781337642224
Author: James D. Gwartney; Richard L. Stroup; Russell S. Sobel
Publisher: Cengage Learning US
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Chapter 28, Problem 14CQ
To determine
Impact of redistribution of points among students.
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Students have asked these similar questions
Income inequality is necessary for Pareto optimality so that people
will work as hard as they can.” “If income is distributed equally, then there must be
Pareto optimality because you can’t make one person better off without making
someone else worse off.” Are these statements true or false? Why or why not?
Is poverty an unfortunate circumstance or a character defect?
Should Happiness be used as a measure of poverty also.Why or why not?
Chapter 28 Solutions
Economics: Private and Public Choice
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- How do factor endowments affect personal income? Examine different provisions employed by the government in dealing with inequality in the distribution of income.arrow_forwardSuppose a government program guarantees $ 2,000 a month in income, even for those who do not work at all. However, if the recipient earns income by working, the benefit is reduced by 50 cents for each $1 earned. Which of the following statements is true? This program will redefine the proverty line. While the goal may be to reduce poverty, people rarely respond to incentives. This program will reduce the incentive to work significantly. The goal of this program is to increase the incentive to work, reducing the poverty trap.arrow_forwardDoes inequality necessarily suggest unfairness? Explain.arrow_forward
- What is the poverty trap? Group of answer choices A)The situation where government assistance can result in a low or zero net gain for working. B)The situation where a person becomes unemployed and cannot find another job. C)The situation where a person becomes disabled and cannot work. D)The poverty trap occurs when a person is poor, and structural discrimination prevents that person from escaping poverty.arrow_forwardWhat is factor mobility?arrow_forwardWhich set of policies is more likely to cause a tradeoff between economic output and equality: policies of redistribution or policies aimed at the ladder of opportunity? Explain how the production possibility frontier tradeoff between economic equality and output might look in each case.arrow_forward
- Comment on or explain: Equality is a “superior good”; the richer we become, the more of it we can afford.arrow_forwardHow does a typical worker decide how many hours to allocate to the labor market?arrow_forwardPoverty is measured by the number of people who fall below a certain level of income—called the poverty line—that defines the income one needs for a basic standard of living. The official definition of the poverty line traces back to Group of answer choices A)The Great Depression B)Mollie Orshansky, whose idea was to define a poverty line based on the cost of a healthy diet. C)1953 and the ability to pay for housing and food. D)The 1965 cost of providing food, housing, and transportation.arrow_forward
- How does a college education increase ones human capitalarrow_forwardIn social welfare programs, there is no way to change either the benefit reduction rate or the benefit guarantee to simultaneously achieve all three goals of encouraging work, redistributing more income and lowering costs. What is this dilemma called?arrow_forwardAlthough it is hard to separate the causes of poverty from the effects, there is no doubt that poverty is associated with various economic and social ills. Suppose that you were a policymaker in the government and your goal was to reduce the number of people living in poverty. How would you achieve this goal?arrow_forward
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