How Is the Poverty Line Calculated

question 106

Multiple Choice

How is the poverty line calculated?

• A) The baseline created in 1964 is used and then adjusted for inflation.
• B) Each year, the cost of a family of four's food is tripled, and that is the poverty line.
• C) The Office of Management and Budget uses the calculations from the welfare departments to announce the poverty line annually.
• D) The poverty line is the same dollar amount as that calculated in 1972.
• E) Elites in control of the government create policies that benefit business.

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Definitions:

Zero Net Difference

When the difference between expense and revenue equals zero; meaning that the values of both are equal; also called breakeven points when revenue and expenses are graphed on the same coordinate plane.

Demand Function

A mathematical formula that describes the relationship between the demand for a good and its price, along with other factors like income and prices of related goods.

Expense Functions

Mathematical expressions that calculate the total costs associated with producing a certain number of goods or services.

Revenue Functions

Mathematical models that describe how a company's revenue is related to the selling price of its products and the quantity of products sold.