Which of the following statements is FALSE?
A. An equal distribution of income would eliminate absolute poverty.
B. In a relative sense, the problem of poverty will always exist.
C. An equal distribution of income would eliminate relative poverty.
D. The official absolute poverty level in the United States is far above the average income of many countries in the world.
Answer: A
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Between 1980 and 2014, income inequality in the United States has increased in part due to expanding international trade. How does expanding international trade contribute to income inequality?
A) It reduces the cost of producing goods and therefore lowers the value of labor's services. B) It allows producers to exploit workers and reduce the wages they are willing to pay workers. C) It increases the demand for a wide array of products which in turn increases prices beyond the reach of average-income individuals. D) Domestic firms can now hire low-skilled workers anywhere in the world, putting U.S. workers in competition with foreign workers. This has caused the wages of unskilled workers to be depressed relative to the wages of other workers.
In 2008, commercial banks' share of the U.S. credit market changed as a result of
A) commercial banks that experienced significant difficulties resulting from real estate investments applied for status as investment banks. B) investment banks that experienced significant difficulties resulting from real estate investments applied for status as commercial banks. C) increasing returns on real estate investments led commercial banks to expand. D) increasing returns on real estate investments led investment banks to expand.
What happens to producer surplus and consumer surplus if transaction costs are reduced?
What will be an ideal response?
Parity pricing refers to
a. a price floor that creates a desired relationship between the prices farmers have to pay for goods they buy and the prices they get for goods they sell b. a price ceiling that creates a desired relationship between the prices farmers have to pay for goods they buy and the prices they get for goods they sell c. the subsidization of farm prices in markets where new technology is adapted d. the government's price intervention to create parity among various farm product prices, such as the price per bushel of corn, wheat, or soybeans e. the government's price intervention to create income equality (or parity) among farms producing identical goods, such as corn or cotton, according to farm size