The official poverty line is defined as:

The official poverty line is defined as:
 a. one-half the average family income.
  b. one-third the average family income.
  c. three times the cost of a minimal food requirement.
  d. two times the cost of a minimal food requirement.

QUESTION 2

Suppose that government purchases of goods and services increase by 200 and at the same time lump-sum taxes increase by 200 . Which of the following is true in this case?
 a. Whether the budget deficit will increase or decrease will depend on the value of the marginal propensity to consume.
  b. The budget deficit will increase by 200.
 c. The budget deficit will increase by 400.
 d. The budget deficit will decrease as the economy expands.
 e. There will be no change in the budget deficit.

QUESTION 3

In April 2010, the U.S. economy added 290,000 jobs but the unemployment rate still increased from 9.7 percent to 9.9 percent. Which of the following best explains this situation?
 a. The size of the labor force shrunk.
 b. The number of unemployed workers also increased, but by a smaller percentage.
 c. The number of illegal immigrants increased substantially.
 d. The number of discouraged workers increased substantially.
 e. The number of unemployed workers also increased, but by an even greater percentage.

QUESTION 4

The largest in-kind transfer program is:
 a. Transitory Assistance to Needy Families.
  b. Medicaid.
  c. Social Security.
  d. SNAP (food stamps).

QUESTION 5

If the U.S. government spent 20 million paying people to dig holes in 2005 and then spent 30 million paying the same people to fill the holes up again that same year, we would expect the net effect to be a(n):
 a. decrease in transfer payments
 b. increase in the budget deficit as transfer payments increased
 c. increase in the budget deficit as government purchases of goods and services increased by 50 million
  d. increase in the budget deficit as government purchases of goods and services increased by 30 million
  e. 10-million-dollar increase in the budget deficit

QUESTION 6

Which of the following groups experiences high unemployment rates?
 a. White-collar professionals
  b. Attorneys
 c. Technical workers
 d. Blue-collar workers
 e. Web page designers