Describe the difference between income inequality and wealth inequality.

Discuss reasons why household income differ.

7. The current chairperson of the United States Federal Reserve Bank is: a. Steve Mouchin, appointed by President Trump b. Janet Yellen, appointed by President Obama c. Ben Bernanke, appointed by President George W. Bush d. Alan Greenspan, appointed by President Ronald Reagan 8. Which of the following is true about accounting and economic profit? a. Economic profit consists of revenue minus implicit and explicit costs. b. Accounting profit consists of revenue minus implicit and explicit costs. c. Economic profit consists of revenue minus implicit costs only. d. Accounting profit consists of revenue minus implicit costs only. 9. If the cross-price elasticity of demand is negative, the goods are a. Inferior b. Substitutes c. Complements d. Normal 10. If the Federal Reserve conducts expansionary monetary policy, what will happen to the nominal interest rate? Decrease b. Increase c. Stay the same d. Not change 11. Which of the following is a method that unions use to increase wages for their members? a. Increase demand for labor b. Decrease supply of labor c. Negotiate higher wages d. All of the above(i) Describe the Pay As You Go method of financing benefits together with two other methods of financing benefits, setting out an advantage and disadvantage of each. [6] The government of a developing country is proposing a series of measures to protect pensioners in defined benefit pension schemes including: . annual actuarial valuations . minimum funding requirements . priority for their benefits over other member categories in the event of employer insolvency . priority of the pensions scheme over other creditors of the employer . payment of a levy to a central fund to be used in the event of employer insolvency where the scheme is underfunded . independent oversight of pension schemes. (ii) Set out the implications of each of these measures for pension schemes in future.A professional football club sponsors a pension scheme which provides final salary benefits to its employees on retirement. The scheme provides benefits to all employees at age 60, including the footballers, whose earnings are significantly higher than other employees. The scheme's actuary is about to perform a funding valuation. (i) Explain the issues the actuary should consider when setting demographic assumptions for the scheme. [4] (ii) Suggest possible reasons why the actuary should monitor experience relating to these demographic assumptions. [2] (iii) Suggest, with reasons, examples of demographic experience which may lead to a surplus in the scheme. [3] The scheme's trustees would prefer the footballers make other plans for their retirement rather than relying on the pension scheme. They propose that all footballers transfer their benefits out of the scheme. (iv) Describe the implications for the pension scheme if the footballers leave the scheme and transfer out their existing benefits. [4] (v) Discuss the advantages and disadvantages for the footballers of moving benefits out of the pension scheme. [6]