What factors make inheritances a source of increased economic inequality?
What will be an ideal response?
Two factors make inheritances a source of increased economic inequality: debts cannot be bequeathed and assortative mating. The law is that debts cannot be passed on to family members. As a result, only positive inheritances, which can add to a family's wealth increasing future generations' wealth, can be made. Most households receive either no inheritance or else a very small one; however, a few receive enormous inheritances. As a result, wealthy families tend to remain wealthy. In addition, assortative mating, the fact that people tend to marry within their own socioeconomic class, also leads to persisting inequality in wealth. In particular, wealthy people marry wealthy people, so that wealth is not passed to poorer families. As a result, inherited wealth becomes more concentrated in wealthy families.
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The derived demand for an input decreases when
A. the price of the input increases. B. the price of the output increases. C. the price of the input decreases. D. the price of the output decreases.
You just heard about Burton's annual tent sale going on next week. This will likely cause your demand for a Burton jacket today to:
A. increase because of your income constraint. B. increase because of your expectations of the price of Burton jackets next week. C. decrease because of your income constraint. D. decrease because of your expectations of the price of Burton jackets next week.
Which of the following did not occur during the Industrial Revolution?
a. Production became more reliant on highly specialized equipment. b. A more efficient division of labor was promoted. c. Workers bore much of the costs of production. d. The transaction costs of contracting with individual resource owners were reduced. e. Technological development increased the productivity of most workers.
A dominant strategy is one that
a. makes every player better off b. makes at least one player better off without hurting the competitiveness of any other player c. increases the total payoff for one player d. is best for a player, regardless of what strategy other players follow e. leads to quicker convergence to market equilibrium