Income Equality Quiz

What is one reason why workers with natural talent or good education tend to earn more?

• They work fewer hours.

• They have more leisure time.

• They can offer labor in markets with a shortage of qualified labor.

• They receive more government subsidies.

Why do people who do not work, such as pensioners, receive lower incomes?

• They have higher expenses.

• They are not in employment.

• They choose to earn less.

• They invest in stocks.

What does the Lorenz curve represent?

• The degree of income or wealth inequality in a country

• The total population of a country

• The average income of a country

• The economic growth rate of a country

What is the definition of absolute poverty?

• A condition where people do not have enough resources to meet all of their basic human needs

• A condition where people have more than enough resources to meet their needs

• A condition where people live above the poverty line

• A condition where people have access to luxury goods

As of September 2022, what is the updated poverty line for absolute poverty?

• $2.15 per day

• $2.00 per day

• $1.95 per day

• $2.50 per day

What is one of the main reasons for reducing absolute poverty?

• To increase government revenue

• To meet basic needs and avoid loss of life from starvation

• To improve global economic growth

• To enhance technological advancements

Why do many people believe poverty and income inequality should be reduced?

• For technological reasons

• For ethical reasons

• For political reasons

• For environmental reasons

What is the main purpose of government intervention in the context of poverty and income inequality?

• To increase economic growth

• To reduce poverty and income inequality

• To decrease taxation

• To promote regressive taxation

What is progressive taxation?

• A tax system where the proportion of income paid in tax decreases as income rises

• A tax system where the proportion of income paid in tax rises as income rises

• A tax system that places the burden more heavily on the poor

• A tax system that does not change with income levels

What is regressive tax?

• It would likely decrease the standard of living.

• A tax system that places the burden of tax more heavily on the poor

• It would likely increase the standard of living.

• It would cause inflation to rise.