Question 1 (Mandatory) (20 points)

Which of the following does Stiglitz cite as among the serious consequences of America's 1% problem? [Multiple answer: Select more than one correct response.]

Question 1 options:

our economic system is seen to fail for most citizens

we see that markets are powerful forces with a strong inherent moral character

a democracy that has been put into peril as confidence in our democracy will erode

an economic system that is less stable and less efficient, with less growth

our sense of national identity may be in jeapordy as the reality sinks in that we are no longer a country of opportunity

our political system is seen to be captured by moneyed interests

Question 2 (Mandatory) (20 points)

Which of the following does Stiglitz cite as ways that the Great Recession has made hard lives even harder? [Multiple answer: Select more than one correct response.]

Question 2 options:

decrease of full-time employment and increase in long-term unemployed

increase incarceration rates

increased life expectancy

decrease in infant and maternal mortality rates

home ownership becomes a burden

increase in young adults aged 25-34 living with parents

Question 3 (Mandatory) (20 points)

What is "trickle down" economics and what does Stiglitz say about this idea?

Question 3 options:

Trickle-down economics refers to the fact that "in the period of increasing inequality, growth has been slowerand the size of the slice given to most Americans has been diminishing" (8). Stiglitz says he wishes this were true, but it's not.

Trickle-down economics refers to the idea that "giving more money to the top [e.g., via tax breaks for the wealthy and for corporations] will benefit the top, partly because it would lead to more growth [e.g., if the wealthy have more money, they can create more jobs]" (8). Stiglitz says this idea has a long pedigreeand has long been discredited.

Trickle-down economics refers to the idea that "giving more money to the top [e.g., via tax breaks for the wealthy and for corporations] will benefit everyone, partly because it would lead to more growth [e.g., if the wealthy have more money, they can create more jobs]" (8). Stiglitz says this idea has a long pedigreeand has long been discredited.

Trickle-down economics refers to the idea that "alleven those at the topcould benefit by giving more to those at the bottom and the middle" (9). Stiglitz says that this could avoid class warfare, or "the politics of envy" (8).

Question 4 (Mandatory) (20 points)

Stiglitz notes that the compensation of corporate executives has grown exponentially in the past three decades, despite evidence that their contributions to society and even to their firms was actually negative (xliv) and despite their moving jobs overseas and firing workers because "they couldn't afford them" (26). While other countries' CEO-to-typical-worker pay is more reasonable, such as Japan's 16 to 1, what does Stiglitz cite as the United States CEO-to-typical-worker ratio as of 2010?

Question 4 options:

423 to 1

342 to 1

200 to 1

243 to 1

Question 5 (Mandatory) (20 points)

Joseph Stiglitz is a leading economics scholar who won the Nobel Prize in 2001. Yet a central thesis ofThe Price of Inequalityis how politics and economics are inextricably intertwined. Which of the following best captures Stiglitz's fundamental thesis about this?

Question 5 options:

	"The cost of the redistribution of income is too high: the gains to the poor and those in the middle are more than offset by the losses to the top. [Redistribution would cause] slower growth and lower GDP [gross domestic product]" (liii).
	"Economics is a form of inquiry that could address the fundamental causes of inequity" (lvii).
	"Unemploymentthe inability of the market to generate jobs for so many citizensis the worst failure of the market, the greatest source of inefficiency, and a major cause of inequality" (xl).
	"Politics have shaped the market, and shaped it in ways that advantage the top at the expense of the rest. ...We have a system that has been working overtime to move money from the bottom and middle to the top, but the system is so inefficient that the gains to the top are far less than the losses to the bottom and middle" (l-liii).