The Lorenz curve:
A. plots graphically the poverty rate over time.
B. is located closer to the diagonal today than it was in 1975.
C. plots graphically the distribution of income.
D. is located farther from the diagonal when income is defined to include the value of noncash
transfers.
Answer: C
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Why does the short-run aggregate supply curve shift to the left in the long run, following an increase in aggregate demand?
A) Workers and firms adjust their expectations of wages and prices upward and they push for higher wages and prices. B) Workers and firms adjust their expectations of wages and prices upward and they accept lower wages and prices. C) Workers and firms adjust their expectations of wages and prices downward and they push for higher wages and prices. D) Workers and firms adjust their expectations of wages and prices downward and they accept lower wages and prices.
When a firm does more of something, it gets better at it. This learning-by-doing is:
A. a source of diseconomies of scale. B. a source of economies of scale. C. called the principle of natural progression. D. called "spreading the overhead."
What variables cause the short-run aggregate supply curve to shift? For each variable, identify whether an increase in that variable will cause the short-run aggregate supply curve to shift to the right or to the left
What will be an ideal response?
At the end of last year the Consumer Price Index was equal to 157.5 and at the end of this year it was equal to 163.8. What is the inflation rate over this time period?
A) 6.3 percent B) 4.0 percent C) 3.85 percent D) 10.1 percent