Chapter 5
Question 4
The level of education gained and retained by individuals has a high probability of determining their earnings in future. This relation is direct in the fact that well educated people acquire high earnings from well-paying professions where they are employed after education. This is however exceptional in some cases as some people benefit from internal and blood relations while getting promotions. This is popular especially in family business where people are promoted regardless of their low education levels.
Question 8
Affirmation action regards to the action of having equality in different working position where people are offered equal opportunity with no emphasis on their gender, religion or race. This equality is limited in most cases and most employees do not employ it making it hard for employees to believe in its existence (Mankiw, 2011). This is because there is a special attachment, which exists among people of the same gender or race making them offer better opportunities to them.
Chapter 6
Question 1
Equality in income distribution in the United States should be highly emphasized to ensure that people live on similar standards. This has never been achieved thus the government and other bodies concerned should insist on this. Equality is advantageous as it ensures distribution of growth and development in the whole country (In Aghion & In Durlauf, 2007). This can be achieved through progressive taxes, which taxes high earning compared to low tax earners.
Question 8
Economic growth has a high probability in reducing poverty as it increases the earning capability of all citizens instead of offering assistance only the underdeveloped. This is increased by private charities, which increase the wellbeing of the needy in the society thus reducing their poverty levels. I retain a liberal opinion on poverty through which I believe the government has the potential to reduce poverty using diverse methods.
Chapter 10
Question 5
There are several factors, which have caused an increased level of hunger in the nation while the production level remains high enough to cater for the people. This is caused by unequal distribution of income which makes some people to have excess income while some have too little to spend. Overpopulation in some parts of the country has also reduced production of the available resources as many people depend on them (In Aghion & In Durlauf, 2007).
Question 7
Human capital pertains to the labor whether manual or skilled offered by people which is determined by their health, education level and moral satisfaction. Increasing the level of education and health ensures that the people are equipped with sufficient skills and are healthy thus increasing production. Favorable housing conditions and good nutrition also increases the production level of human capital.
Chapter 2
Question 1
Public goods involve different products or services, which are enjoyed by the public freely without having to pay for them. These goods are not charged and are available to all members of the public without discrimination thus is non-excludable (Mankiw, 2011). These include roads and highways, clean and unpolluted air and national security offered by the government.
Question 6
Increasing taxes on illegal drugs is a manner, which the government can use to reduce the percentage of illegal drugs being traded. Excise taxes in both cigarettes and drugs involve increasing the level of taxation charged depending on the amount of drugs traded. It is called sin tax as it acquired from an increase in the purchase of drugs thus its increase is dependent on an increase on the trade of drug level. This is however not solely true as their taxation is also because they give income to the traders which is liable to taxation.
References
In Aghion, P., & In Durlauf, S. N. (2007). Handbook of economic growth. Amsterdam: Elsevier.
Mankiw, N. G. (2011). Principles of economics. Mason, Ohio: Thomson South-Western.
