Determining the Poverty Line Involves Decisions About All These Factors

question 26

Multiple Choice

Determining the poverty line involves decisions about all these factors except:

• A) the level of TANF benefits
• B) the cost of a market basket of food
• C) the ratio between food and non-food costs
• D) an index for changing prices
• E) whether to include the value of in-kind benefits

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Definitions:

Distortions

Refers to alterations or imperfections in economic market conditions that lead to inefficient resource allocation and outcomes.

Consumption

Spending by households on goods and services, with the exception of purchases of new housing.

Money Balances

The total amount of money held by individuals or entities in the form of cash or bank deposits.

Wealth Redistribution

The transfer of income and wealth from some individuals to others by means of a social mechanism such as taxation, public services, or welfare.