The Official Poverty Measure (OPM) compares a measure of a family’s financial resources to a dollar...

The Official Poverty Measure (OPM) compares a measure of a family’s financial resources to a dollar amount representing the family’s needs. Families with resources less than needs are considered to be in poverty. The measure of needs is the cost of a thrifty food basket multiplied by 3.

(1) What was the rationale for this calculation when it was originally created-- in other words, why was THE COST OF A THRIFTY FOOD BASKET multiplied by 3)?

(2) Why might this calculation (i.e., thrifty food basket x 3) no longer be a valid measure of a family’s needs?

(3) What is ONE way that the Supplemental Poverty Measure (SPM) fixes this problem?

Expert Solution

Rahul Sunny answered 2 years ago

The Official Poverty Measure (OPM) only includes cash income in its measures of a family’s resources....

The Official Poverty Measure (OPM) only includes cash income in its measures of a family’s resources. (1) Why is this a problem for understanding the effects of most of our anti-poverty programs? (2) What is ONE way in which the Supplemental Poverty Measure (SPM) fixes this problem?

The Birr is the official currency of Ethiopia. The Wakandan dollar is the official currency of...

The Birr is the official currency of Ethiopia. The Wakandan dollar is the official currency of Wakanda. Both countries use flexible (floating) exchange rates If in Ethiopia the CPI increases from 160 to 167 while in Wakanda the CPI increases from 120 to 126, what do we predict? Answer: "we predict that the Birr will appreciate relative to the Wakandan dollar". Why? Thanks

Explain U.S. poverty and how it compares to the rest of the world

Explain why, if you measure poverty according to the Supplemental Poverty Measure, the Earned Income Tax...

Explain why, if you measure poverty according to the Supplemental Poverty Measure, the Earned Income Tax Credit (EITC) reduces poverty the most of any program except for Social Security, but if you measure poverty according to the Poverty Gap, the EITC is less effective at reducing poverty. (15 points) In the paper “The EITC and the Extensive Margin: A Reappraisal,” Kleven says that the increases in the EITC in the mid-1990s did not increase the employment rates of mothers as...

How adequate is the "poverty line" in India as a measure of economic poverty and what...

How adequate is the "poverty line" in India as a measure of economic poverty and what conclusions can be drawn from it about India's progress in eradicating poverty? In this context, comparatively, evaluate targeting versus universalism with self-selection as a principle of effective social policy. Discuss the pros and cons of the conditional cash transfer and cash incentives system in this regard. ANSWER EACH PART IN DETAILS AND IN ABOUT 2000 WORDS.

40. The official poverty line in the United States is set A) equal to one-half the...

40. The official poverty line in the United States is set A) equal to one-half the average income in the United States. B) at three times the cost of the Department of Agriculture's minimum food budget. C) at three times the cost of the Department of Housing's minimum housing allowance. D) at the amount necessary to allow an individual to buy the same market basket of goods that the average urban wage earner can afford.

The official poverty line has been the subject of much debate over the last few decades....

The official poverty line has been the subject of much debate over the last few decades. On Google or another search engine, look up and read the work of Molly Orshansky. Her work focused on finding a measure of poverty that reflected a bundle of goods that people in different circumstances must be able to purchase. Describe the debate and the resulting system for setting the poverty thresholds. Should they be updated? If so, what would you recommend?

Define/distinguish the difference between the concepts of absolute/official and relative poverty. Provide and discuss an example...

Define/distinguish the difference between the concepts of absolute/official and relative poverty. Provide and discuss an example of each concept.

What is the unsatisfied basic needs method to measure poverty (UBN)?

Compare the method used by the United Nations to measure of global poverty, to the method...

Compare the method used by the United Nations to measure of global poverty, to the method used to measure U.S poverty rate

Question