Deck 13: Expenditure Programs for the Poor

Question 1

Under TANF,the time limit for receiving benefits during a lifetime is

A)12 years.
B)13 weeks.
C)60 months.
D)5 months.

Answer 1

60 months.

Question 2

The Earned Income Tax Credit (EITC)

A)provides more income to those people on welfare.
B)is a tax on low income workers.
C)provides additional tax credits to low income workers.
D)is a tax break for the wealthiest Americans.

Answer 2

provides additional tax credits to low income workers.

Question 3

The group comprising the highest percentage of the poor is

A)the disabled.
B)elderly.
C)male heads of households.
D)children.

Answer 3

children.

Question 4

Which group is not provided aid by Medicaid?

A)elderly
B)blind
C)disabled
D)poor

Question 5

Federal job training programs

A)help provide job market skills to those in poverty.
B)have been overwhelmingly effective in helping those in poverty.
C)cost very little money per person participating.
D)do all of the above.

Question 6

How many elderly people are covered by Medicare?

A)one third
B)one half
C)almost all
D)almost none

Question 7

The switch from AFDC to TANF took place in

A)1937.
B)1986.
C)1996.
D)1998.

Question 8

The gross replacement rate is

A)the proportion of pretax earnings replaced by unemployment insurance.
B)a rate of employment in key sectors of the economy.
C)the percentage of each paycheck that is removed for unemployment insurance.
D)the rate that tax receipts are used to cover tax expenditures.
E)none of the above.

Question 9

The maximum amount of EITC benefit in 2008 was?

A)$6090
B)$2398
C)$104
D)$4824

Question 10

Voucher programs for housing

A)provide rent vouchers for existing housing stock.
B)are under utilized with a surplus of housing stock.
C)provide down payment assistance to purchase homes.
D)are known as Section 8.

Question 11

Enrollment in the Medicaid program

A)is designed for those persons 65 years of age and older.
B)has increased due to expanded eligibility.
C)covers all medical expenses that a poor person may incur.
D)requires a substantial co-payment that has not been helpful to poor families.

Question 12

Expenditures on major need-tested programs from the federal government for medical care amounted to _____ in 2004.

A)$98.1
B)$28.8
C)$46.9
D)$20.0
E)none of the above

Question 13

A dollar reduction in benefits as a result of a dollar income from working is a

A)50% tax rate.
B)75% tax rate.
C)22.5% tax rate.
D)100% tax rate.

Question 14

Which is the largest cash transfer program for the poor?

A)TANF
B)Medicare
C)SSI
D)Medicaid

Question 15

Social Security Income(SSI)is available for all,except

A)aged.
B)immigrants.
C)blind.
D)disabled.

Question 16

All of the following are in-kind benefit programs,except

A)food stamps.
B)Medicaid.
C)energy assistance.
D)SSI.

Question 17

Under TANF,at least 50% of single mother recipients and 90% of two-parent families must be working or in work preparation programs.

Question 18

The United States' official measure of poverty is measured by

A)only cash income.
B)cash income and capital gains.
C)only in-kind income.
D)the imputed value of rent payments.

Question 19

The average food stamp payment in 2007 was?

A)$100
B)$300
C)$0
D)$215

Question 20

The Head Start program

A)has been successful in fostering better levels of school attainment.
B)began in 1965.
C)provides preschool activities for 4 and 5 year old disadvantaged students.
D)does all of the above.

Question 21

Medicaid is the most expensive program that the government runs that provides benefits to the poor.

Question 22

Suppose in a certain city the demand for low-cost housing can be characterized by the equation P = 500 - 2Q,where Q is housing measured in square feet.Further,suppose that supply is characterized by the equation: P = 25 + 3Q.
(A)How much consumer surplus is there?
(B)Suppose that a grant is given so that the supply of housing is increased.This increase changes the supply curve to P = 3Q.How much does consumer surplus change because of the grant?

Question 23

Only about a quarter of the population eligible for housing subsidies actually receives them.

Question 24

What are some of the drawbacks,as you see them,to a program like Workfare?

Question 25

The gross replacement rate is typically 95% of pretax earnings.

Question 26

One of the changes in the welfare system of the United States that occurred in 1996 was a move to block grants for states.What advantage(s)might a block grant system allow?

Question 27

Crowding out can occur when public insurance crowds out private insurance.

Question 28

This question is similar to Discussion Question 1 of Chapter 13 in your textbook.In New York,a welfare recipient can earn $90 per month without having her benefits reduced.Beyond $90,benefits are reduced by 57 cents for every dollar of earnings.Consider Jackie,a resident of New York,who can earn $10 per hour.If she does not work at all,she is eligible for welfare benefits of $577.
(A)If she works 10 hours,how much are her work earnings,how much is her welfare benefits,and how much is her total income?
(B)After Jackie works a certain number of hours,she does not receive any benefits at all.What is that number of hours? enjoy

Question 29

Return to Question 22 above.Suppose that the government feels that the grant is not enough and,in addition,imposes a price ceiling of $270.What will happen to consumer surplus? What are the drawbacks?

Question 30

The majority of government programs designed to help poor families consists of direct cash payments.

Question 31

Over the years,there have been many programs designed to help the poor.One of the more popular ones has been the Earned Income Tax Credit (EITC).What makes this program so popular?

Question 32

Unemployment taxes are collected from both employees and employers.

Question 33

Workfare requires able-bodied individuals to participate in work-related activities in order to receive transfer payments.

Question 34

A needy family consisting of a mother and three children currently receives cash benefits that average $12 per day.The mother of this family is allowed to earn an average of $4 per day before her benefits begin to decline.After that,for each dollar earned,cash benefits decline by 67 cents for each dollar earned.Assume that she can find work at $4 per hour.How many hours will she have to work per day before her benefits are eliminated?

Question 35

Consider a negative income tax.As discussed in your textbook,under the negative income tax,each person is entitled to a grant of G dollars per month.For every dollar the person earns,the grant is reduced by t dollars.Suppose G = 200 and t = 0.40.Consider an individual whose hourly wage is $10.There are 30 days in a month (so T is 720).Sketch the budget constraint before and after the introduction of a negative income tax.