Question :
11) If all households in a nation receive the same : 1241413
11) If all households in a nation receive the same income, the nation’s Lorenz curve
A) is horizontal.
B) is vertical.
C) is a 45° line.
D) runs along the horizontal axis until it reaches 50 percent of households and then runs vertically up to 100 percent of income.
E) runs along the horizontal axis until it reaches 100 percent of households and then runs vertically up to 100 percent of income.
12) Country A has a more equal distribution of income than country B if
A) country A’s Lorenz curve is closer to the line of equality than is country B’s Lorenz curve.
B) country B’s Lorenz curve is closer to the line of equality than is country A’s Lorenz curve.
C) country A’s Lorenz curve is just as close to the line of equality as is country B’s Lorenz curve.
D) country A’s Lorenz curve lies below country B’s Lorenz curve at low levels of income and above it at high levels of income.
E) None of the above because it is impossible to compare income inequalities across countries.
13) Looking at the Lorenz curves for income distribution in all the world’s nations, we would find that
A) some nations have Lorenz curves that lie above the 45° line, other nations have Lorenz curves that lie below the 45° line, but no nation has a Lorenz curve that lie on the 45° line.
B) all nations have Lorenz curves that lie above the 45° line.
C) all nations have Lorenz curves that lie below the 45° line.
D) some nations have Lorenz curves that lie above the 45° line, other nations have Lorenz curves that lie below the 45° line, and still other nations have a Lorenz curve that lies on the 45° line.
E) None of the above answers is correct.
Group
Percent of income
Poorest 20%
5
Second poorest 20%
10
Middle 20%
15
Second richest 20%
25
Richest 20%
45
The table gives the distribution of income in Miseria.
14) What percent of income is earned by the richest forty percent?
A) 5 percent
B) 20 percent
C) 70 percent
D) 55 percent
E) More information is needed to answer the question.
15) What percent of income is earned by the richest 60 percent of the population?
A) 25 percent
B) 30 percent
C) 55 percent
D) 85 percent
E) More information is needed to answer the question.
16) What percent of income is earned by the poorest 60 percent of the population?
A) 25 percent
B) 30 percent
C) 55 percent
D) 15 percent
E) More information is needed to answer the question.
17) What percent of income is earned by the richest 80 percent of the population?
A) 25 percent
B) 95 percent
C) 100 percent
D) 5 percent
E) More information is needed to answer the question.
18) The above table shows the distribution of income in two countries, Alpha and Beta. Based on these distributions of income,
A) Country Beta has more equal income distribution than does Country Alpha.
B) both countries have equal distributions because 100 percent of the incomes are accounted for.
C) the Lorenz Curve for country Beta is closer to the line of equality.
D) Country Alpha has a more equal distribution of income than does Country Beta.
E) It is impossible to answer the question without more information.
19) The above table shows the distribution of income in two countries, Alpha and Beta. In Country Alpha, the poorest 20 percent receive ________ percent of total income.
A) 5
B) 9
C) 1
D) 19
E) 14
20) The above table shows the distribution of income in two countries, Alpha and Beta. In Country Beta, the richest 40 percent of households receive ________ percent of total income.
A) 20
B) 40
C) 60
D) 80
E) 100
