Which of the following measurement issues makes interpretation of U.S. poverty rates difficult?
A. Poverty statistics measure consumption rather than income, and some families may
receive income that is above the official poverty line.
B. The high cost of living in urban areas tends to result in the understatement of poverty.
C. Most people below the poverty line have substantial unreported income.
D. The poverty rate is adjusted for every urban and rural area, so people's poverty status
changes whenever they move.
Answer: B
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Government intervention can be productive and efficiency enhancing:
A. whenever it regulates a market. B. in markets for public goods and common resources. C. because the government always acts with altruistic motives. D. except in markets for public goods.
The civilian labor force consists of all the:
a. people in the economy who are not retired. b. people in the economy over 16 years of age. c. adults in the economy between 18 and 65 years old who are able to work. d. noninstitutionalized adults in the economy who hold jobs or are looking for them. e. citizens in the economy who are graduates of high school.
Why are people willing to pay more for a diamond than for a bottle of water?
What will be an ideal response?
An income tax leads to double taxation on saving only if consumption is the measure to gauge a person's ability to pay.
Answer the following statement true (T) or false (F)