Archive for November, 2017

Real World Graduation, Question 6

by Edward Posted: Sunday, 11/26/2017

RealWorldGraduation_Question_6   <– PDF

A person wishes to donate $100 to a charity. What percentage of the $100 will actually go to the cause for which the charity was established?

  1. a) All of it (100%) will go for the cause, because that’s what charities are legally required to do
  2. b) None of it (0%), because all charities are rip-offs
  3. c) There are always some expenses associated with fundraising, but these are regulated, and charities are required to spend more than 90% of contributions on the cause.
  4. d) There are always some expenses associated with fundraising, but these are regulated, and charities are required to spend more than 80% of contributions on the cause.
  5. e) There are always some expenses associated with fundraising, but these are regulated, and charities are required to spend more than 70% of contributions on the cause.

(Answer on p. 2 of the PDF.)

Tags:
Posted in critical thinking, Real World Graduation | No Comments »

Real World Graduation, Question 5

by Edward Posted: Sunday, 11/19/2017

RealWorldGraduation_Question_5   <– PDF

A study by the U. S. Department of Education in 2006 [1] reported that college tuition, fees, and room and board are continuing to rise. The data in Figure 5-1 shows the costs of tuition, fees, books, and room and board for in-state students attending public four-year universities, living on-campus.  A separate study [2] concluded that a college graduate with a 4-year degree in 2005 will earn 63% more than a person with only a high school diploma (approximately $57,000 per year vs. $35,000 per year).  This means, on average, that a college graduate earns approximately 75% more over their working lifetimes ($2.1 M vs. $1.2 M) as compared to a person with only a high-school diploma.  Given the costs of a college education shown in Figure 5-1, and the earnings benefits of a college education, what is a good federal policy regarding college costs?

  1. a) The federal government should ensure all tuition, fees, and room-and-board is free.
  2. b) Congress should enact price controls on tuition, fees, and room and board to keep the annual rate of increase at or below the rate of inflation.
  3. c) Congress should pass a law requiring that tuition costs be frozen at the rates that prevailed during the freshman year.
  4. d) Attendance at college should be mandatory so that everyone’s income will rise.
  5. e) Some combination of a), b), and c) should be adopted to improve the current system.

School Year    Tuition & Fees ($)    % Increase in Tuition & Fees     Room & Board ($)     % Increase in Room & Board

1998-1999          3640                                –                                             4985                                           –

1999-2000          3768                            3.52                                          5144                                         3.19

2000-2001              3979                        5.60                                         5342                                         3.85

2001-2002              4273                         7.39                                         5675                                         6.23

2002-2003             4686                         9.67                                         5918                                         4.28

2003-2004             5363                        14.45                                        6316                                          6.73

2004-2005             5939                         10.74                                        6649                                         5.27

2005-2006             6399                           7.75                                        7025                                         5.65

Figure 5-1

(Answer on p. 2 of the PDF)

Tags:
Posted in critical thinking, Economics, Real World Graduation, Student loans | No Comments »

Real World Graduation: Question 4

by Edward Posted: Saturday, 11/11/2017

RealWorldGraduation_Question_4   <– PDF

Article I, Section 2 of the U. S. Constitution originally contained the following provision:

“Representatives and direct Taxes shall be apportioned among the several States which may be included within this union, according to their respective Numbers, which shall be determined by adding to the whole number of free persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three-fifths of all other persons.”

In this passage, “representatives” refers to the number of seats in House of Representatives in Congress, “Numbers” refers to population, “several States” refers to any State that ratifies the Constitution, “those bound to service” refers to indentured servants (those who had committed to a term of voluntary servitude in compensation for repayment of the voyage to America fronted by others), “Indians not taxed” refers to Indians on reservations, “other persons” refers to slaves, and “free persons” refers to anyone not in the “other person” group, i.e. not slaves.

This passage can therefore be clarified as follows: “Representatives and direct Taxes shall be apportioned among the States according to their respective population, which shall be determined as the sum of the number of a) all free persons, b) indentured servants, and c) three-fifths of slaves; specifically excluding Indians on reservations.” In other words, representation in Congress was apportioned to the full population of all people in the state not on reservations, except for slaves, whose apportionment was at a fraction of only 60%.  This is known as the “three-fifths” rule.  This three-fifths provision was superseded by the 14th Amendment, which was ratified 9 Jul 1868.

Why did the Founding Fathers insert the three-fifths clause regarding slaves?

  1. a) Most of the Founding Fathers were slave owners who had contempt for black people, and reduced the value of black people to 60% of a white person because it was a long-held tradition.
  2. b) Most of the Founding Fathers were slave owners who had contempt for black people, and reduced the value of a black person to 60% of a white person in an attempt to deprive the slaves of their fair share of welfare payments.
  3. c) Even the Founding Fathers who did not own slaves were racist, and reduced the apportionment of slaves to 60% of a white person to suppress the political influence of the black slaves in the Southern states.
  4. d) The members of the Democratic Party insisted on this provision before they would allow a ratification vote in the Southern states.
  5. e) Each of the Founding Fathers had different motives, but these motives were generally a combination of a), b), and c).

(The answer shown on p. 2 of the PDF.)

Tags: , , , , ,
Posted in Articles of Confederation, Constitutional Convention, critical thinking, Early American history, Real World Graduation, U. S. Constitution | No Comments »

Real World Graduation, Question 3

by Edward Posted: Sunday, 11/5/2017

RealWorldGraduation_Question_3   <– PDF

In 1979, a certain woman bought a large number of popular “collectible” dolls. It was commonly believed at that time that these dolls would increase in value over time, and as such, were considered by some to be a worthwhile investment. In fact, some were suggesting that a $5.00 doll purchased in 1979, if kept in its original packaging, would find buyers in 1999 (20 years later) at a price of $100.00 or more, far in excess of the effects of inflation. This means that these dolls were expected to increase in value about 16.1% per year (in so doing, their value would double every 4.47 years, and would be worth 20 times what they were purchased for at the end of 20 years). If the effects of inflation were also considered, the dolls would be expected to sell for a lot more in 1999.

However, in 1999, the woman who bought the dolls found that there was virtually no demand for them, other than their usual value as children’s toys. She has been offered $1.50 each by another collector, which will represent a considerable loss to her. What actions should be taken?
a) The woman should sell the dolls for $1.50 each, then sue the person who sold her the dolls in 1979 to recover the other $98.50 each (plus whatever extra is due owing to inflation).
b) The woman should sell the dolls for $1.50 each, then sue the person who sold her the dolls in 1979 for $3.50 each; that way, she at least recovers her investment.
c) This woman will have to take the loss, but the state or federal government should pass a law prohibiting the sale of “collectible” dolls.
d) Because collectibles always increase in value over the long run, she should hold onto them and make even more per doll than the original $100.00 estimate. Her inability to sell them at a profit now is only a temporary setback.
e) This was a case of questionable behavior by the original seller. This woman will have to take the loss. But, in order to prevent this from happening to other people, the state or federal government should pass a law requiring background checks and permits for anyone who manufactures or sells dolls.

Tags:
Posted in critical thinking, Economics, Real World Graduation | No Comments »