12. Which set of policies is more likely to cause a tradeoff between economic output and equality: policies of

redistribution or policies aimed at the ladder of opportunity? Explain how the production possibility

frontier tradeoff between economic equality and output might look in each case.

13. Why is there reluctance on the part of some in the United States to redistribute income so that greater

equality can be achieved?

Review Questions

14. How is the poverty rate calculated?

15. What is the poverty line?

16. What is the difference between poverty and income inequality?

17. How does the poverty trap discourage people from working?

18. How can the effect of the poverty trap be reduced?

19. How does the U.S. government specifically support elderly people experiencing poverty?
384 15 • Critical Thinking Questions

20. What is the safety net?

21. Briefly explain the differences between TANF, the earned income tax credit, SNAP, and Medicaid.
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