Question 1

According to the World View titled "Muhammad Yunus: Microloans," who won the Nobel Peace Prize for developing microcredit?

Accepted Answer

Muhammad Yunus won the Nobel Peace Prize for developing microcredit as stated in the World View.

Question 2

According to the World Bank definitions, there are more people in the world living in extreme poverty than there are living in severe poverty.

Accepted Answer

According to the World Bank definitions, extreme poverty is defined as living on less than $1.90 per day, while severe poverty is defined as living on less than $3.20 per day. As of 2015, there were approximately 736 million people around the world living in extreme poverty and 1.2 billion people living in severe poverty. Therefore, there are more people in the world living in severe poverty than in extreme poverty.

Question 3

Over half of the people in the world who live in extreme poverty live in China and India combined.

Accepted Answer

According to data from the World Bank, as of 2015, 55% of the people living in extreme poverty globally reside in China and India.

Question 4

According to the official U.S. threshold, 35 percent of Americans live in poverty.

Accepted Answer

According to the official U.S. threshold, the poverty rate is currently set at 10.5 percent of the population, not 35 percent. However, different organizations and researchers may use different measurements and criteria for defining poverty, which can lead to varying estimates.

Question 5

The U.S. poverty standard in 2009 was set at $35,000 per year for a family of four.

Accepted Answer

The U.S. poverty standard in 2009 for a family of four was actually set at $22,050 per year.

Question 6

If the U.S. government considers the value of in-kind transfers, the U.S. poverty rate decreases.

Accepted Answer

In-kind transfers such as food stamps, housing subsidies, and Medicaid are not included in the official poverty rate calculation. However, if these in-kind transfers are included, the poverty rate decreases as they provide additional resources to those in need.

Question 7

Poverty is considered to be more permanent in the United States than it is in other nations.

Accepted Answer

Poverty in the United States, like in other nations, can be transient or persistent, depending on various factors such as economic conditions, social policies, and individual circumstances. There is no evidence to suggest that poverty is inherently more permanent in the U.S. compared to other countries.

Question 8

One World View article is titled "Glaring Inequalities." Of the countries listed, the greatest inequality in the distribution of income is likely to occur in

Accepted Answer

Namibia has one of the highest levels of income inequality in the world, as measured by the Gini coefficient, which is a statistical measure of economic inequality in a population.

Question 9

A World View article, "The Female 'Inequality Trap,'" says that in many poor nations the "… returns on female human capital investment is low." When women are not allowed to work outside the home or to receive an education, this is referred to as

Accepted Answer

The term "inequality trap" is specifically mentioned in the article as a way to describe the low returns on female human capital investment in many poor nations where women are not allowed to work or receive an education. Option A, "productivity trap," is not as relevant to the article and does not directly address the issue of gender inequality. Option B, "prejudice gap," is not a common term used to describe this issue and is not mentioned in the article. Option C, "justice gap," while a possible way to describe the issue, is not specifically used in the article and does not address the aspect of low returns on investment.

Question 10

According to the World View titled "Jeffrey Sachs: Big Money, Big Plans," how does Columbia University economics professor Jeffrey Sachs expect global poverty rates to be reduced by half by 2015?

Accepted Answer

Columbia University economics professor Jeffrey Sachs expects global poverty rates to be reduced by half by 2015 by having rich nations double their foreign aid flows now and then double them again in 10 years, while poor nations must develop full-scale, comprehensive plans for poverty reduction. Therefore, option A is the correct choice.

Question 11

The official U.S. poverty standard was set in 1963 at $3,000 per year for a family of four.

Accepted Answer

The official U.S. poverty standard was indeed set in 1963 at $3,000 per year for a family of four. However, this standard has been adjusted over time to account for inflation and cost of living adjustments. As of 2021, the poverty guideline for a family of four is $26,500.

Question 12

The U.S. government counts both cash income and in-kind transfers when determining the poverty rate.

Accepted Answer

The U.S. government primarily uses cash income before taxes and does not include the value of noncash benefits (such as public housing, Medicaid, and food stamps) when determining the poverty rate.

Question 13

One World View article is titled "Glaring Inequalities." Of the countries listed, the least inequality in the distribution of income is likely to occur in

Accepted Answer

The article states that Japan has a low Gini coefficient, which is a measure of income inequality. It also mentions that Japan has a high standard of living and a strong welfare system, which can contribute to reducing inequality in the country. The other three countries listed (Mali, Botswana, and Guatemala) are known to have higher levels of income inequality.

Question 14

The World Bank defines extreme poverty as income of less than $1.25 per day per person.

Accepted Answer

This is a correct definition of extreme poverty according to the World Bank.

Question 15

One World View article in the text is titled "Dying for a Drink of Clean Water." By 2015 the U.N.'s Millennium water goal expects to reduce the percentage of people in the world without safe drinking water by

Accepted Answer

The article states that the U.N.'s Millennium water goal aims to reduce the percentage of people without safe drinking water by half (50 percent) by 2015. Therefore, C) 50 percent is the correct answer.

Question 16

According to the World Bank, almost 3 billion people are classified as being in severe poverty.

Accepted Answer

According to the World Bank, as of 2021, almost 3 billion people are living on less than $5.50 per day, which is classified as severe poverty.

Question 17

According to the World View article titled "The Way We Give: Philanthropy Can Step In Where Market Forces Don't," in which of the following ways does philanthropy not improve the market outcome?

Accepted Answer

Philanthropy cannot require firms to research new and improved health care solutions as this is something that should fall under their responsibility as part of the market forces. Philanthropy can draw in experts, give awards, and make novel arrangements with private companies to improve market outcomes.

Question 18

According to Bill Gates, from the World View article titled "The Way We Give: Philanthropy Can Step In Where Market Forces Don't," more than 90 percent of the money devoted to health research is spent on those who

Accepted Answer

According to the article, Bill Gates states that more than 90 percent of the money devoted to health research is spent on those who are the healthiest, meaning that the answer is B.

Question 19

In-kind transfers include housing subsidies and food stamps.

Accepted Answer

In-kind transfers are non-monetary forms of assistance and can include housing subsidies and food stamps.

Question 20

American poverty is more about absolute deprivation, and poverty in the rest of the world is more about relative deprivation.

Accepted Answer

Poverty in America often involves relative deprivation, where individuals may have basic needs met but still fall significantly below the standard living conditions of the society. In contrast, poverty in many parts of the rest of the world can involve absolute deprivation, where individuals lack fundamental needs like food, clean water, and shelter.

Quiz 23: International Economics