Title: Economics Questions

Contents

1. Why does the government provide benefits in-kind? Why don’t we just give money to low-income people?

2. Some people inherit money and wealth that they did nothing to earn. Why don’t we tax inheritance at 100 percent?

3. Sally and Joe recently graduated from college, both majoring in history. Joe took a prestigious job as a legal clerk. Sally took a job as a specialist in fighting forest fires.  Both received additional training before entering their jobs. Who will likely earn a higher salary and why? Sally will earn higher, because fire fighting is a riskier job.

4. The mythical country of Quitar has just established a policy to give very generous in-kind benefits to the nation’s poor, currently defined as those earning less than $10,000 a year. Several years later, the poverty rate has not fallen. Why not?

5. Why don’t we divide the economic pie evenly so that each person receives the same income?

6. Erin just won Lotto America, which will pay her $40 million over the next 20 years at a rate of $2 million a year. Is Erin $40 million richer today?

7. Ethyl does not like redheads and refuses to hire any at her business. Paul was the perfect candidate on paper, but the personal interview revealed that he was a redhead. Are there any costs to Ethyl for not hiring Paul?

8. Joanne states: “The best way to increase the wages of workers is to increase worker productivity.” Is Joanne correct? Why or why not?

9. If people prefer to consume goods now rather than in the future, how does anyone save money?

10. In a barter economy that had no form of currency, how could interest exist?

Total number of words (answers only): 307