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Eco Chapter 13 Section 3

Chapter 13 Section 3
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Coty 10083bea

on 4 May 2010

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Transcript of Eco Chapter 13 Section 3

Chapter 13
Section 3 Vocabulary Poverty Threshold The income level
below which income
is insufficient to
support a family
or household. Poverty Rate The percentage of
people who live
in households with
income below the
official poverty line. Income Distribution How the nation's total
income is distributed
among its population Food Stamps Government-issued coupons
that recipients exchange that
recipients exchange food. Lorenz Curve The curve that
illustrates income
distribution. Enterprise Zone Area where companies
can locate free of certain
local, state, and federal
taxes and restrictions. Block Grant Federal funds given
to the states in lump
sums Workfare A program requiring
work in exchange for
temporary assitance The Poor The Census Bureau
defines a family as
a group of two or more
people related by birth,
marriage, or adoption who
live in the same housing unit. The Poverty Threshold A poor family is one whose total
income is less than the amount required
to satisfy the family's minimum needs.
The poverty threshold is the income
level below which income is insufficient
to support a family or household. In 2004, the poverty threshold for a single parent
under age 65 with one child was $12,490. For
a family of four with two children, it was $18,850.
If a family's income is below that all members are
considered poor. The poverty Rate Poverty Rate is the percentage of people
who live in households with income below
the official poverty threshold. Factors of Poverty Rate Race and Ethnic Origin
Type of family
Age
Residence Causes of Poverty Lack of Education The median income of high school
drop-outs in 2003 was $18,344, which
was just above the poverty threshold for
a family of four in that year. High-school graduates earn about one third more then dropouts and college graduates earn about three times more. Location People who live on
the inner city earn
less due to the fact
that most people on
the inner city don't
own there own cars
and take public
transportation. Racial and Gender Discrimination White workers generally earn
more then minority workers,
and men generally earn more
than women. Most of this is due
to hours worked, education, and
work experience althought some
is discrimination. Although
Economists agree that discrimination
is diminishing. Economic Shifts People with less education and skills
are mostly the last hired and first fired. When companies are expanding
they hire people with less skills if workers are hard to find and then when the economy declines they fire the people with less skills Shifts in Family Structure Divorce rate has risen significantly
since the 1960's. as the number rises
so has children born to unmarried
parents leading to more children living
in poverty. Income Distribution In 2003, the average household income
was $43,318
Income Distribution or how the nation's
total income is distributed among its population. Income Inequality Food stamps are goverment-issued
cupons that recipients exchange for
food 4 Steps to compute the numbers of income
distribution
First, they rank the nation's households
acording to income
Then they divide the list into fifths, or
quintiles, with equal numbers of households
in each fifth. The lowest fifth includes 20 %
of households.
Next, they computer each group's average
income by adding up the incomes of all the
households in the group, and then dividing by
the number of households.
Finally, they computer each group's share
or percentage of total income by dividing the
group's total income by the total income of all
the groups. The graphy, (on page 348) called the Lorenz
Curve, illustrates the distribution of income
in the economy Income Gap Factors of income differences
between Americans Differences in Skills and Education
Inheritances
Field of work Antipoverty Policies Billion of dollars are spent on programs
designed to reduce poverty such as; cash
assistance, education, medical benefits,
and noncash benefits such as food stamps. Enterprise Zones Became popular in 1980's an area where companies can locate free of certain state, local, and federal taxes and restrictions. Employment Assistance In recent decades, federal and state governemtns have designed jobtraining programs to deal with the problem of workers who lack skills. Welfare Reform Welfare profides for poor people who
cannot provide for thereselfs. TANF
(Temporary Assistance for Needy
Families) is a major reform that took
place when President Clinton signed
the Personal Responsibility Act of 1996.
TANF eliminated cash assistance for poor
families instead the federal government
provides block grants or lump sums of money to the states. TANF also set a 5-year limit on receipt of benefits
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