Many Argue the Poor Are Getting Poorer, at Least in a Relative

question 88

Multiple Choice

Many argue the poor are getting poorer, at least in a relative sense. Evidence that contradicts this is that

• A) household income of the lowest twenty percent of households relative to the highest twenty percent of households has fallen over the last thirty years.
• B) the official poverty level of income has increased over the years.
• C) household spending of the lowest twenty percent of households relative to the highest twenty percent of households has held constant over the last thirty years.
• D) the pretax distribution of income is more equal than the after-tax distribution of income.

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Definitions:

Marginal Cost

The increase in expense from creating one more unit of a product or service.

Total Cost

The total cost of production, encompassing both variable and fixed expenses.

Average Cost

The total cost of production divided by the number of goods produced, representing the cost on average of producing each unit of output.

Average Variable Cost

The total variable cost divided by the quantity of output produced, representing the variable cost of producing each unit of output.