Economists Caution That Conventional Statistics Used to Estimate the Extent

question 7

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 progressive.
• 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:

F. Skinner

B.F. Skinner was an influential American psychologist known for his work in behaviorism, particularly the development of the theory of operant conditioning.

Albert Bandura

A psychologist who is well-known for his work on social learning theory and the concept of self-efficacy.

Interactionist Approach

A theoretical perspective that emphasizes the combined effects of both individual characteristics (such as genetic traits) and environmental factors (such as societal influences) on human behavior.

Self-Efficacy

Refers to an individual's belief in their own ability to complete tasks and reach goals.