The Lorenz curve
A) shows what portion of the population are living in poverty and what portion are living in wealth.
B) shows what portion of total money income is accounted for by different proportions of the nation's households.
C) shows what portion of the population is working as professionals, white- and blue-collar, workers and workers at menial tasks.
D) breaks down the income levels of each group in the economy.
Answer: B
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The metaphor used to describe the working of the price system to achieve efficiency in a free market is
a. Occam's razor. b. the prisoner's dilemma. c. the invisible hand. d. the benefit principle.
Estimations of demand are used as input in this type of scenario:
A. understanding automobile demand to decide whether to offer below-market-rate loans for new cars. B. as input into a firm's decision-making process. C. understanding the demand for oil in order to impose a new oil import tax. D. all of the above
Which of the following is a defining characteristic of all perfectly competitive markets?
A. The market demand curve is perfectly elastic. B. All firms sell the same standardized product. C. Consumers display strong brand loyalty. D. Each firm in the market faces a perfectly inelastic demand curve.
In a perfectly competitive market, market price and output are determined by the ______ of the market supply and demand curves.
a. slants b. parallelism c. intersection d. proximity