Taking into Account the Incentive Effects of Redistribution on the Poor

question 230

Multiple Choice

Taking into account the incentive effects of redistribution on the poor, utilitarianism suggests that:

• A) giving dollars to poor people is the best way to improve their welfare.
• B) giving dollars to poor people is not always the best way to improve their welfare.
• C) poor people tend to be more responsive to incentives.
• D) poor people tend to be less responsive to incentives.

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Definitions:

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset since it was put into use, representing its reduction in value over time.

Net Book Value

Refers to the value of an asset after deducting accumulated depreciation and amortization from its original cost.

Wages Expense

The total cost incurred by a company for paying its employees' salaries and wages during a specific period.

Adjusting Journal Entry

A journal entry made at the end of an accounting period to record any unrecognized income or expenses, ensuring that the financial statements comply with the accrual basis of accounting.