Final Exam

In 2017, the average income for households in the United States was about

$61,372

Employer-provided private health insurance:

Is unique to the United States and not typically found in other countries.

Since 1950, farm productivity has:

advanced twice as fast as in nonfarm sectors of the economy.

The Cellar-Kefauver Act of 1950:

amended the Clayton Act.

Which of the following would, other things equal, reduce the demand for U.S. farm products?

appreciation of the U.S. dollar

Government purchases and transfer payments:

differ because the former absorbs resources while the latter does not.

In determining one's personal income tax, taxable income is:

total income fewer deductions and exemptions.

In the United States, the lifetime distribution of income is more equal than the annual distribution. This statement is:

true because there is considerable income mobility over time.

The voluntary relocation of employable migrants from low-paying nations to high-paying nations reduces:

wage rate disparities among nations.

Which is correct?

wealth is less equally distributed than income and therefore increases income inequality.

Efficiency gains from migration:

will tend to be greater when workers migrate from nations with high unemployment to nations experiencing full employment.

Responsibility for enforcing the antitrust laws rests:

with both the Justice Department and Federal Trade Commission.

A function of the Federal Trade Commission is to:

investigate instances of faulty and misleading advertising

Income

is a flow concept.

The Gini ratio:

is the numerical measure of the overall dispersion of income in a nation.

If the demand for an agricultural product is inelastic, a bumper crop will:

lower price and decrease total revenues.

The Sherman Act was designed to:

make monopoly and acts restrain trade illegal.

One consequence of the long-run problem faced by farms has been a :

massive exit of workers from agriculture to other sectors of the economy.

Government borrowing:

may crowd out private sector investment.

"Backflows" occur when:

migrants return to their home country.

Immigrants tend to choose countries closer to their country of origin because:

migration costs tend to be directly related to distance from the country of origin.

Which of the following statements about U.S. agriculture is true as it relates to the past several decades?

minimum efficient scale has increased, the price of farm products has declined, and the number of farms has declined.

Tying agreements:

obligate a purchaser of product X to also buy product Y from the same seller.

The Loren Curve:

plots graphically the distribution of income.

Which of the following statements is true about health care costs in the United States?

Costs have risen because both the price of health care and the quantity provided have risen.

The total amount of U.S. tax revenue needed to finance the public sector

Is larger today, as a percentage of the domestic output in this century

Income mobility

Is the movement of individuals and households from one income qulitile to another over time

Which of the following cases best illustrates economic immigration?

Julio migrated to Australia to take a job paying three times what he earned at home.

Which of the following is an exhaustive governmental outlay?

NASA payment to Boeing Corporation for space hardware.

The problem faced by farms in the long run as portrayed in the diagram would involve price and quantity changes from

P2 to p3 and q1 to q4

The largest category of federal spending is for:

Pension and income security

The largest source of tax revenue for the U.S. federal government is:

Personal income taxes

The three most important sources of federal tax revenue in the order of descending importance are

Personal income, payroll, and corporate income taxes.

A progressive tax is such that:

Tax rates are higher the greater one's income

All of the following can file antitrust charges under the Sherman Act except:

The Federal Energy Regulatory Commission.

A bumper crop of farm products causes:

a large decline in the price of farm products because the demand for farm products is price inelastic.

An extraordinarily small crop of farm products due to drought causes:

a large increase in the price of farm products because the demand for farm products is price inelastic.

The H1-B provision of immigration law:

allows 65,000 high-skilled workers in specialty occupations to enter and work in the United States for six years.

The perceived central economic problem associated with the U.S. health care system is:

an overallocation of resources to the system.

Which of the following is least likely to violate the Sherman Act or the Clayton Act?

competitive firms F and G independently charge lower prices to frequent customers than to occasional customers.

IN the United States, "farm products" are generally produced in more ___________ markets, while "food products" tend to be sold in markets that are more ___________.

competitive; oligopolistic

Voluntary migration of skilled craftworkers from low-paying to high-paying nations is most likely to be opposed by:

craft unions in the high-paying nations.

Farm share of U.S. GDP has:

declined from about 7 percent in 1950 to 1 percent today.

"Beaten paths" from one country to another:

encourage migration by providing employment contacts and job information

The Clayton Act of 1914:

outlawed price discrimination, tying contracts, acquisition of stock of competing corporations, and interlocking directorates that lessen competition.

Which of the following would, other things equal, increase the demand for U.S. farm products?

poorer crops abroad.

The Cellar-Kefauver Act of 1950:

prohibited any firm from acquiring the real assets of another firm where to effect was to lessen competition.

The major objective of Medicaid is to:

provide health care services to those receiving public assistance.

the price of medical care in the United States has:

risen faster than the overall price level.

Total U.S. health care spending in 2017was approximately:

3.5 trillion

The maximum federal marginal tax rate on taxable personal income is, as of 2019

37 percent

Suppose the members of population A, consisting of Al, Bob, Curt, Doris, and Ellie, receive annual incomes of $5,000, $2,500, $1,250, $750, and $500, respectively. Refer to the given information. What percentage of total income is received by the richest quintile?

50

Approximately what percent of the federal government's tax revenues are generated from personal income taxes (in 2018)?

51 percent

According to the Office of Immigration Statistics, approximately what percentage of legal immigrants in 2017 were parents, children, siblings, or other qualified relatives of legal permanent U.S. residents?

66 percent

Which of the following countries has the largest number of immigrants, as a percentage of the labor force (as of 2017)?

Australia

Rapidly rising U.S. health care costs have:

Done all of these

The greater the area between the Lorenz curve and the diagonal in the Lorenz curve diagram, the:

. larger is the Gini ratio and the greater the degree of income inequality.

What percentage of their spending do U.S. consumers allocate to food purchases?

10 percent

Suppose Slow Ketchup requires that, as a condition of purchase, all restaurants using its product must buy and make available its new sales product. This arrangement is an example of:

A tying contract

Which of the following is least likely to be considered economic immigration?

Alexander migrates to the United States because his political writings are censored in his home country.

As a proportion of domestic output, taxes in the United States:

Are lower than in most other industrially advanced countries

Which diagram best represents the problem faced by farms in the short run?

B

Which of the following diagrams best describes the long-run path of real (inflation-adjusted) farm prices?

B

Which of the following amended the Clayton Act's prohibition against mergers that substantially lessen competition?

Cellar-Kefauver Act of 1950.

Tying contracts are illegal under the:

Clayton Act of 1914.

Which of the following laws prohibit mergers by acquisition if the effect was to lessen competition?

Clayton Act of 1914.

The addition of government to the circular-flow model illustrates that government:

Does all of the things stated in the other possible answers

Roughly what portion of U.S. total health spending is paid for by private and public insurance?

Four-fifths

As a percentage of GDP, U.S. health care spending is

Higher than for any other major industrial country

The movement of individuals and households from one income quintile to another over time is called:

Income mobility

Revenues flowing to the government from government-run or government-sponsored businesses, such as public utilities and state lotteries, are known as:

Property income

Which of the following is not an important source of revenue for the federal government?

Property taxes

The major purpose of Medicare is to

Provide health care services to people on social security

The tax rates embodied in the Federal personal income tax are such that:

The marginal tax rate is higher than the average tax rate, causing the average tax rate to rise.

A person will be more likely to migrate the:

greater the wages in their prospective new country relative to wages in their home country.

the opportunity cost of borrowing funds to finance the government deficit is:

greatest when the economy is doing well

Which of the following statements is correct?

if the demand for agricultural products is inelastic a relatively small decrease in supply will increase gross farm incomes.

"Remittances" occur when:

immigrants send financial payments back to family in their country of origin

The twin problems of the U.S. health care industry are:

rapidly rising costs and unequal access to health care.

The demand for agricultural products is:

relatively inelastic with respect to price.

Housing subsidies for low-income households:

represent a non-cash transfer.

Proprietary income refers to:

revenue generated by government-run businesses.

Suppose the courts declare that XYZ Corporation violated the antitrust laws and as a result the ABC Corporation lost $100 million profits. XYZ Corporation will have to pay ABC Corporation a monetary award of:

$300 million

Approximately how many people became permanent legal residents of the United States in 2017?

1,127,167

According to U.S. Census Bureau data (2015), approximately how many illegal immigrants are established to be living continuously in the United States?

12 million

Transfer payments are about ____ percent of U.S. domestic output (as of 2018).

14

The United States devotes about ______ percent of its domestic output to health care.

17.9

Aggregate U.S. health care spending in 2017 was approximately

17.9 percent of domestic output (GDP)

Total governmental purchases—Federal, state, and local combined—account for about what percentage of domestic output?

18 percent

In the quintile distribution of income, the term "quintile" represents:

20 percent of the income receivers.

In the U.S., approximately how many doctors are there per 100,000 of the population?

224

The U.S. Census Bureau estimates that from 2000 to 2009, the net inflow of unauthorized immigrants was about:

250,000 annually

Approximately how many millions of Americans did not have health insurance coverage in 2017?

29

The lowest quintile of households in the income distribution (as of 2017) receives about?

3.1 percent of total income

Which diagram best represents the problem faced by farms in the long run?

A

Which of the following is directly illegal under the Sherman Act?

Price-fixing

The highest quintile of households in the income distribution (as of 2017)?

Receives about 3 percent of the total income

Wealth

Refers to accumulated financial and real assets.

For many years, the price of medical care in the United States has

Risen at a faster rate than the overall price level

Which of the following statements is correct?

Rising health care costs are a major cause of limited access to the health care system.

Census data indicate that, as of 2011, the top fifth of all households receive about ________ times as much income as the bottom fifth.

Seventeen

Which of the following made monopoly and restraint of trade criminal offenses against the federal government?

Sherman Act of 1890.

Movie producers A, B, and C secretly meet and agree to release their summer blockbuster films in sequence, rather than at the same time. The U.S. Justice Department learns of the agreement and files an antitrust suit. The federal government would most likely file chargers under the:

Sherman Act, Section 1.

When the United States is described as having a dual system of health care, this means

Those Americans with good insurance or substantial wealth receive world-class health care, while those without insurance receive no or low-quality health care

Which of the following gave the federal Trade Commission responsibility to protect the public against false and misleading advertising?

Wheeler-Lea Act of 1938

Standard Census data on the distribution of income:

are before taxes in that they do not account for personal income and payroll taxes.

Economic immigrants:

are defined as international migrants motivated by economic gain.

Worker migration will cause wage rates to equalize across two countries if all of the following conditions are met except:

both countries use the same currency.

In the United States:

both taxes and transfers decrease income inequality

The exercise of market power by suppliers in resource markets tends to:

increase income inequality by raising incomes of those able to "rig the market."

As a percentage of GDP, health care spending in the United States has:

increased substantially since 1960.

Over time, technological change has:

increased the minimum efficient scale of production in agriculture and reduced the prices of farm products.

When economists say that health care services are overconsumed, they mean that:

some resources now used in the health care industry could produce alternative goods and services that society values more highly.

Which one of the following acts declared "Every contract, combination ... or conspiracy, in restraint of trade or commerce among the several states ... to be illegal"?

the Sherman Act

Human capital refers to:

the accumulated knowledge and skills that allow a person to be productive.

Which of the following best describes the short-run problem faced by farms?

the highly inelastic nature of agricultural demand, together with fluctuations in exports of farm goods, has caused small year-to-year fluctuations in farm output to result in highly unstable farm incomes.

The primary motivation for economic immigration is:

the opportunity to increase earnings and standard of living.

Which one of the following is not prohibited by the original Clayton Act?

the purchase of the assets or rival firms that lessens competition.

Which of the following best describes the main problem faced by farms in the long run?

the supply of farm products has increased relative to the demand for them, and, because demand is inelastic, farm prices and income have therefore declined.