One Cost-Of-Living Indicator Shows That a Salary of $40,000 in Santa

question 102

Multiple Choice

One cost-of-living indicator shows that a salary of $40,000 in Santa Barbara, California is equivalent to $14,000 in Wichita, Kansas. This is primarily because of the cost of housing, which is much less expensive in Wichita. What does this difference say about how the federal government calculates poverty?

• A) It shows that poverty is connected to the local cost of living, which reflects the differences in rates of poverty in different parts of the country.
• B) It shows that the poverty line is more or less accurate, because it has been recalibrated to take into account housing costs.
• C) It points to a flaw in the way the government calculates the poverty line, as the standard is uniformly applied without regard to regional differences.
• D) It points to a flaw in the way the government calculates the poverty line, as it proves there are far more poor people in the Midwest.

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