Discuss the criticisms leveled against the Aid to Families with Dependent Children program.
What will be an ideal response?
Aid to Families with Dependent Children (AFDC) was a classic example of an inefficient redistributive program. One major reason was that it provided no incentive for welfare mothers to earn income. Once monthly earnings passed a few hundred dollars, AFDC payments were reduced by $1 for each $1 that the family earned as wages. Consequently, many welfare recipients did not look very hard for work. In addition, critics argued that “the welfare mess” was too bureaucratic, too expensive, and might even be hurting the very people it was designed to help by, for example, encouraging out-of-wedlock births and fostering a culture of dependence on the state.
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If the rate of economic growth is positive, then everyone becomes better off
a. True b. False
The usual results of an adverse supply shock are
a. a rise in prices and a fall in output. b. a fall in prices and a rise in output. c. increased growth and lower inflation. d. higher net exports.
It is _______ that protection makes a nation worse off because it induces the firms in that nation to produce more of the goods that are costly to make and; it is _____ that one nation can gain from international trade only at the expense of other nations.
A. true; true B. false; false C. false; true D. true; false
Refer to the above table. The price of a hamburger is $2, the price of a movie is $10, and the consumer has $44. What is the change in quantity demanded of hamburgers if the price of a hamburger decreases to $1?
A. Quantity demanded increases by 2 hamburgers. B. Quantity demanded increases by 4 hamburgers. C. Quantity demanded increases by 1 hamburger. D. Quantity demanded increases by 3 hamburgers.