According to the Maximin Criterion, Income Should Be Transferred from the Rich

question 162

Multiple Choice

According to the maximin criterion, income should be transferred from the rich to the poor as long as it

• A)raises the well-being of the least fortunate.
• B)does not alter incentives to work and save.
• C)promotes an equal distribution of income.
• D)does not lower the welfare of the elderly.

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Definitions:

Output Produced

The total amount of goods or services created or produced by an economic unit, such as a company or country, within a specific period.

Substitution Effect

The change in the consumption of goods in response to a change in their relative prices, holding the consumer's level of utility constant.

Labor Supply Curve

The graphical representation showing the relationship between the different wage rates and the quantity of labor that workers are willing to supply.

Wage Rate

The amount of compensation a worker receives per unit of time, such as an hour or a week, for their labor.