Economists Caution That Conventional Statistics Used to Estimate the Extent

question 99

Multiple Choice

Economists caution that conventional statistics used to estimate the extent of poverty in the United States fail to account for benefits people receive that, if considered, would reduce the amount of poverty.Which of the following is an example of these benefits?

• A)Individuals can use tax credits and the personal exemption to reduce their taxable incomes. This reduces what they owe the government and increases their disposable incomes.
• B)The federal income tax system is progressive. As a result, the poor have higher after-tax incomes than they would have if the income tax system was proportional or regressive.
• C)Individuals with low incomes receive non-cash benefits such as free school lunches and food stamps.
• D)The federal minimum wage forces employers to pay workers with low skills an efficiency wage.

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Definitions:

Authoritative

A parenting style characterized by high expectations of maturity and communication from the parent to the child, combined with warmth and support.

Warmth

The quality of being kindly, genial, and showing a sincere interest in the comfort or well-being of others.

Demands

Refers to the requirements or needs that individuals or systems have, which may require fulfillment or response.

Authoritarian

Characterizes a leadership or governmental style that demands strict obedience from its citizens or followers without allowing personal freedom.