SOLVED

101) Which of the following is true regarding the distribution of wealth and the distribution of income? A) The distribution of wealth is a less accurate measure of inequality because it excludes human capital. B) The distribution of wealth is a more accurate measure of inequality because it includes houses. C) The distribution of income is a less accurate measure of inequality because it excludes the value of things you own. D) The distribution of income is a less accurate measure of inequality because not everyone has a job. 102) If human capital was included in the measurement of wealth, the measurement of wealth would be A) more equal and more accurate. B) more equal and less accurate. C) less equal and more accurate. D) less equal and less accurate. 103) Measured distributions of wealth that do not consider the role of human capital A) are more equal than the distribution of income. B) overstate the inequality in wealth distribution. C) are more equal than the distribution of consumption. D) understate the inequality in wealth distribution. 104) Sue has human capital worth $500,000 and nonhuman capital of $100,000. Todd has human capital worth $10,000 and nonhuman capital of $50,000. The return on each type of capital is 10 percent a year. Sue’s income is ________ and Todd’s income is ________. A) $10,000; $5,000 B) $50,000; $1,000 C) $600,000; $60,000 D) $60,000; $6,000 105) Sue has human capital worth $500,000 and nonhuman capital of $100,000. Todd has human capital worth $10,000 and nonhuman capital of $50,000. The return on each type of capital is 10 percent a year. According to the Census Bureau in the national wealth and income survey, Sue is ________. A) as wealthy as Todd B) 10 times wealthier than Todd C) twice as wealthy as Todd D) 50 times wealthier than Todd 106) Lifetime income is distributed A) less equally than annual income and less equally than measured wealth. B) less equally than annual income and more equally than measured wealth. C) more equally than annual income and less equally than measured wealth. D) more equally than annual income and more equally than measured wealth. 107) Of the following, which is the most accurate indicator of the degree of inequality? A) distribution of annual income B) distribution of lifetime income C) distribution of wealth D) distribution of the sum of wealth and annual income 108) The lifetime income distribution of income is a ________ accurate indicator of the degree of economic inequality than the distribution of ________. A) less; of annual income B) more; of annual income C) less; of wealth D) less; annual Lorenz curves 109) In the country of Konswano there are 4 people. Each person lives for 40 years. In their first 10 years, they earn no income. In the next 20 years, they earn $40,000 per year and in the last 10 years they earn no income. Each year their consumption is $20,000. If everyone in Konswano is 25 years old, then the Lorenz curve for income is ________. A) above the Lorenz curve for wealth B) above the line of equality C) equal to the line of equality D) below the Lorenz curve for wealth 110) In the country of Konswano there are 4 people. Each person lives for 40 years. In their first 10 years, they earn no income. In the next 20 years, they earn $40,000 per year and in the last 10 years they earn no income. Each year their consumption is $20,000. If the people in Konswano are aged 5, 15, 25, and 35, then the distribution of annual income ________. A) is equal to the line of equality B) is above the line of equality C) has greater inequality than when everyone is 25 years old D) has greater equality than when everyone is 25 years old