7) During the last two decades, there has been an increase in income inequality in the United States.

Which of the following is a reason income inequality in the United States has increased?

A) There are sharply lower marginal tax rates now than in the 1970s.

B) Marginal tax rates have increased significantly since the 1970s.

C) There has been a great increase in efficiency of government antipoverty programs.

D) There has been a significant drop in the number of single-parent families.

8) Which of the following is correct regarding these income transfers?

A) Means-tested income transfers have more than doubled per-capita income during the period 19702014.

B) Means-tested government programs lead to lower implicit marginal tax rates.

C) Means-tested income transfers have not been very effective in reducing poverty.

D) Means-tested government programs are not linked to income levels.

9) As income transfer programs accompanying the War on Poverty increased beginning in the latter half of the 1960s, what happened to poverty in the United States? Check all that apply.

A) In 2014, the adjusted poverty rate was only 2 percentage points lower than the official rate in 1970.

B) The poverty rate declined substantially in the period before the War on Poverty, but not in the period after the start of the War on Poverty.

C) The adjusted poverty rate has declined rapidly and is now less than half of the official poverty rate.

D) The poverty rate in the United States declined substantially after the start of the War on Poverty.

10) Consider the following scenario in the state of Taxopia.

One family has an annual income of $100,000, while another family has an annual income of only $20,000. Under what circumstances would this outcome be considered unfair in terms of the process view of fairness?

A) The family with the high income has three income earners, whereas the family with the lower income has only one income earner.

B) In the family with the high income, both spouses work, whereas the family with the lower income relies on Social Security payments.

C) The family with the higher income is headed by a person who completed a college degree, whereas the other family is headed by someone with low educational achievement.

D) The family with the higher income derives most of its income from the farm subsidy program.