If the government decreased urban welfare payments by a dollar for every dollar increase in farm subsidies, which of the following is the likely net effect?
a. An increase in the budget deficit because government spending has increased
b. A decrease in the budget deficit because transfer payments are not included in the government's budget
c. An increase in the budget deficit because transfer payments have increased
d. An increase in the budget deficit because farm subsidies are transfer payments but urban welfare payments are not
e. No change in the budget deficit
QUESTION 2The labor force participation rate for women in the United States has _____.
a. stayed the same over the last 30 years
b. increased significantly since the 1950s
c. decreased significantly since the 1950s
d. fluctuated substantially both upward and downward since the 1950s
e. increased only very slightly since the 1950s
QUESTION 3Which of the following is not counted as income when the official poverty rate is calculated?
a. Medicaid benefits.
b. dividends derived from the ownership of stock.
c. earnings derived from a part-time job.
d. money income derived from transfer payments.
QUESTION 4Which of the following would decrease the size of a federal budget deficit?
a. A recession
b. An increase in defense spending
c. An increase in the use of automatic stabilizers
d. An increase in taxes
e. An increase in transfer payments
QUESTION 5Which of the following is true of the labor force participation rate?
a. When workers become unemployed, the labor force participation rate declines.
b. When the unemployed become discouraged workers, the labor force participation rate declines.
c. When workers do not fully use their skills, the labor force participation rate decreases.
d. Since the 1950s, the labor force participation rate of women has decreased in the United States.
e. The trend toward earlier retirement has increased the labor force participation rate in the United States.
QUESTION 6The level of money income below which a family is considered poor is called the:
a. bottom 20 percent of the income distribution.
b. poverty income level.
c. guaranteed income level.
d. subsistence income level.
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