CHAPTER 18
The Two Americas
Inequality, Class, and Conflict
MULTIPLE CHOICE QUESTIONS
135. What are sources of income for individuals in the U.S.?
a. employee compensation, profits, interest, and rent
b. employee compensation, profits, government transfers, and credit card debt
c. employee compensation, interest, government transfers, and credit card debt.
d. employee compensation, interest, rent and outstanding student loans.
136. What is the difference between income and wealth?
a. Income is the value of accumulated assets minus liabilities held by an individual.
b. Income is the total value of accumulated assets held by an individual.
c. Income is the stream of receipts from work or property generated by an individual over a
particular time period.
d. Income is the total amount of money owed in debts by an individual.
137. What is the difference between income and wealth?
a. Wealth is the value of accumulated assets minus liabilities held by an individual.
b. Wealth is the total value of accumulated assets held by an individual.
c. Wealth is the stream of receipts from work or property generated by an individual over a
particular time period.
d. Wealth is the total amount of money owed in debts by an individual.
138. Income inequality can be measured by the distribution of income. A common method of
measuring the distribution of income is to use quintiles. What does this mean?
a. each quintile represents the number of people earning the same level of income.
b. each quintile represents one fifth of the total population and the percent of total income
received by that fifth.
c. each quintile represents one fifth of the total income or GDP and the percent of the
population earning that fifth.
d. each quintile represents 5 percent of the population.
139. What was the approximate average (median) net worth for the wealthiest 20% of U.S.
households in 2000?
a. $185,000
b. $1,850,000
c. $18,500
d. $18,500,000
140.
a. a group of people who obtain their income in a way that distinguishes them from other
groups.
b. a group of people who know how to behave in most social situations.
c. a group of people who graduate from high school in the same year.
d. a group of people defined by how much income they receive.
141.
a. North and South America.
b. Red states and blue states.
c. urban and rural America.
d. the rich and the poor.
142. Total personal income to US households was $10,891 billion in 2006. Approximately what
percent of this income came from employee compensation?
a. 68.7%
b. 31.3%
c. 94%
d. 14%
143. What is a Gini coefficient?
a. a measure of income inequality that falls between zero and one.
b. a measure of income inequality that falls between 1 and 10.
c. a measure of income inequality that falls between 1 and 50.
d. a measure of income inequality that falls between 1 and 1000.
144. According to the World Bank, the Gini coefficient for India was 0.368 in 2004-05 and
0.513 for Argentina in 2004. Based on this data,
a. India has a more equal distribution of income than Argentina.
b. Argentina has a more equal distribution of income than India.
c. The top 20% of the population has 36.8% of the income in India and 51.3% in Argentina.
d. The bottom 20% of the population has 36.8% of the income in India and 51.3% in
Argentina.
145. An often cited statistic is the ratio between CEO salaries and those of average worker. In
1960, the average CEO earned 41 times as much as the average worker. In 1997 the ratio
had increased to approximately
a. 82
b. 123
c. 224
d. 326