Econ 530 Study Study Guide Graded A+
B) The level of relative inequality.
A) size
D) the factors of production (land, labor and capital).
D) Poverty line
C) Lorenz curve
A) True
B) False
A) then poverty will fall and inequality will fall.
B) then poverty will not change and inequality will...
Ans: The Gini coefficient provides a measure of
A) the level of poverty.
B) the level of relative inequality.
C) disguised unemployment.
D) the rate of growth.
2). A) size
Ans: Distribution of income according to percentiles, such as the highest 40% or lowest
20% is known as the ______________ distribution of income.
A) size
B) functional
C) GNP-weighted
D) equal-weighted
3). D) the factors of production (land, labor and capital).
Ans: The functional distribution of income refers to the distribution of income between
A) individuals or households.
B) rural individuals or households.
C) urban individuals or households.
D) the factors of production (land, labor and capital).
4). D) poverty line
Ans: Which of the following indicators does not belong to the family of indicators
A) Size distribution of income
B) Functional distribution of income
C) Kuznets ratio
D) Poverty line
5). C) lorenz curve
Ans: Which of the following indicators does not belong the the family of indicators
A) Head Count Index (HCI)
B) Poverty gap
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, C) Lorenz curve
D) Multidimentional Poverty Index (MPI)
6). A) true
Ans: True / False: Wealth generates income, but income MAY create wealth (if
managed well)
A) True
B) False
7). B) false
Ans: Trure/ False: Poverty is a relative term, but inequality is an absolute term
A) True
B) False
8). A) then poverty will fall and inequality will fall.
Ans: If incomes rise for low-income workers but don't change for high-income workers.
A) then poverty will fall and inequality will fall.
B) then poverty will rise and inequality will fall.
C) then poverty will rise and inequality will rise.
D) then poverty will fall and inequality will rise.
9). B) then poverty will not change and inequality will rise.
Ans: If the level of income rises for high-income workers but doesn't change for low-
income workers,
A) then poverty will not change and inequality will fall.
B) then poverty will not change and inequality will rise.
C) then poverty will rise and inequality will fall.
D) then poverty will fall and inequality will rise.
10). B) quintiles, or dividing a whole group into fifths.
Ans: A method often used by economists to look at distribution of income in a society's
economy involves
A) programs for wealth redistribution.
B) quintiles, or dividing a whole group into fifths.
C) imposing taxes to redistribute wealth.
D) None of the above
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