Microeconomics (13th Edition)
13th Edition
ISBN: 9780134744476
Author: Michael Parkin
Publisher: PEARSON
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Question
Chapter 19, Problem 21APA
To determine
The impact of news on the income distribution of the society.
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1. Describe how each of these changes is likely to affect poverty and inequality:
a. Incomes rise for low-income and high-income workers, but rise more for the high-income earners
b. Incomes fall for low-income and high-income workers, but fall more for high-income earners.
2. Based on the theory of rational ignorance, what should we expect to happen to voter turnout as the Internet makes information easier to obtain?
3. What is the cost of voting in an election?
4. What is the main factor preventing a large community from influencing policy in the same way as a special interest group?
5. How does the TANF attempt to loosen the poverty trap?
The table shows the distribution of income in the Australia
Complete the column of the table that records the cumulative percentages of income in Australia received by the
cumulative percentages of households.
Cumulative
percentage of
Income
Households
Lowest 20 percent
(percentage) Households Income
8
Lowest 20
13
Lowest 40
Second 20 percent
Third 20 percent
18
Fourth 20 percent
23
Highest 20 percent 38
Lowest 60
Lowest 80
100
100.0
The graph shows the Lorenz curve for the United States
Draw the line of equality
Draw a point to show the cumulative percentage of income received by the lowest 40 percent of Australian
households Label it 1,
Draw a point to show the cumulative percentage of income received by the lowest 80 percent of Australian
households. Label it 2
Draw the Lorenz curve for Australia. Label it
Based on the data provided, which country has the more unequal income distribution?
OA Australa
OB. Neither. They have the same degree of inequality.
OC, The United States
OD. It…
State three ways that the government could reduce income inequality. Briefly explain how these programs would reduce inequality.
Chapter 19 Solutions
Microeconomics (13th Edition)
Ch. 19.1 - Prob. 1RQCh. 19.1 - Prob. 2RQCh. 19.1 - Prob. 3RQCh. 19.1 - Prob. 4RQCh. 19.1 - Prob. 5RQCh. 19.2 - Prob. 1RQCh. 19.2 - Prob. 2RQCh. 19.2 - Prob. 3RQCh. 19.3 - Prob. 1RQCh. 19.3 - Prob. 2RQ
Ch. 19.3 - Prob. 3RQCh. 19.3 - Prob. 4RQCh. 19.3 - Prob. 5RQCh. 19.4 - Prob. 1RQCh. 19.4 - Prob. 2RQCh. 19.4 - Prob. 3RQCh. 19 - Prob. 1SPACh. 19 - Prob. 2SPACh. 19 - Prob. 3SPACh. 19 - Prob. 4SPACh. 19 - Prob. 5SPACh. 19 - Prob. 6SPACh. 19 - Prob. 7SPACh. 19 - Prob. 8SPACh. 19 - Prob. 9APACh. 19 - Prob. 10APACh. 19 - Prob. 11APACh. 19 - Prob. 12APACh. 19 - Prob. 13APACh. 19 - Prob. 14APACh. 19 - Prob. 15APACh. 19 - Prob. 16APACh. 19 - Prob. 17APACh. 19 - Prob. 18APACh. 19 - Prob. 19APACh. 19 - Prob. 20APACh. 19 - Prob. 21APACh. 19 - Prob. 22APACh. 19 - Prob. 23APA
Knowledge Booster
Similar questions
- = The $1.4 billion trick to make us accept income inequality Lotteries take money from the poor and redistribute it unequally. The poor, the uneducated, and minorities play the lottery the most, and it takes a big chunk of their income. Source: The Huffington Post, January 12, 2016 If the news clip is correct, how does a lottery change the distribution of income? Draw two Lorenz curves to illustrate your answer. CID Lotteries result in the distribution of income OA. becoming more unequal OB. becoming more equal OC. remaining unchanged Draw the Lorenz curve in a country that does not have lotteries. Label it Before. Draw the Lorenz curve for the country after the introduction of lotteries. Label it After. >>> To reposition the label click on the cross by the label box and drag it. Cumulative percentage of income 100- 80- 60- 0 20 40 60 80 100 Cumulative percentage of households >>> Draw only the objects specified in the question. 40- 20-arrow_forward4. The Census Bureau recently created a new sup- plemental poverty measure, which defines the poverty threshold as the amount of money that the poorest third of Americans spend on food, clothing, shelter, and utilities. Journalist Robert Samuelson [2010] proposed the following thought experiment: Suppose that all Americans doubled their incomes tomorrow, and suppose that their spending on food, clothing, shelter, and utilities doubled as a result. What would happen to the number of people in poverty ac- cording to this new supplemental measure? Does this strike you as a desirable measure?arrow_forward. What is Medicare and how is it funded? (Provide at least 5 points).arrow_forward
- What are the main reasons economists give for the increase in inequality of incomes?arrow_forwardBriefly explain the differences between TANF, the earned income tax credit, SNAP, and Medicaid.arrow_forwardTable 15.9 shows the share of income going to each quintile of the income distribution for the United Kingdom in 1979 and 1991. Use this data to calculate what the points on a Lorenz curve would be, and sketch the Lorenz curve. How did inequality in the United Kingdom shift over this time period? How can you see the patterns in the quintiles in the Lorenz curves?arrow_forward
- What is measured on the two axes of a Lorenz curve?arrow_forwardUsing two demand and supply diagrams, one for the low-wage labor market and one for the high-wage labor market, explain how information technology can increase income inequality if it is a complement to high-income workers like salespeople and managers, but a substitute for low-come workers like file clerks and telephone receptionists.arrow_forwardWhat are some reasons why a certain degree of inequality of income would be expected in a market economy?arrow_forward
- Explain how a country may experience greater equality in the distribution of income, yet still experience high rates of poverty. Hint: Look at the Clear It Up 'How do governments measure poverty in low-income countries?' and compare to Table 15.5.arrow_forwardA group of 10 people have the following annual incomes: 55,000,30,000,15,000,20,000,35,000,80,000,40,000,45,000,30,000,50,000. Calculate the share of total income each quintile of this income distribution received. Do the top and bottom quintile s in this distribution have a greater or larger share of total income than the top and bottom quintiles of the U.S. income distribution for 2005?arrow_forwardHow has the inequality of income changed in the U.S. economy since the late 1970s?arrow_forward
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