One cost-of-living indicator shows that a salary of $40,000 in Santa Barbara, California is equivalent to $14,000 in Wichita, Kansas. This is primarily because of the cost of housing, which is much less expensive in Wichita. What does this difference say about how the federal government calculates poverty?
A) It shows that poverty is connected to the local cost of living, which reflects the differences in rates of poverty in different parts of the country.
B) It shows that the poverty line is more or less accurate, because it has been recalibrated to take into account housing costs.
C) It points to a flaw in the way the government calculates the poverty line, as the standard is uniformly applied without regard to regional differences.
D) It points to a flaw in the way the government calculates the poverty line, as it proves there are far more poor people in the Midwest.

Question

Quizplus · Accepted Answer

The difference in cost of living between Santa Barbara and Wichita suggests that the federal government's uniform calculation of the poverty line is flawed. The poverty line is based on a national average and does not take into account regional differences in the cost of living. As a result, the poverty line may be inaccurate in some regions, leading to either underestimation or overestimation of poverty rates.

One Cost-Of-Living Indicator Shows That a Salary of $40,000 in Santa