-The Above Figure Shows the Lorenz Curves for Four Different

question 9

Multiple Choice

-The above figure shows the Lorenz curves for four different countries. Which of the following statements is FALSE?

• A) Country A has an income distribution that is not perfectly equal.
• B) Country D's income distribution is the most unequal of the four countries.
• C) The distribution of income is more unequal in country A than in country B.
• D) The distribution of income is more unequal in country D than in country C.

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Definitions:

Less Risk-averse Investors

Individuals who are willing to take on greater levels of investment risk in pursuit of higher returns.

Efficient Portfolios

Portfolios that offer the best possible expected return for their level of risk, based on modern portfolio theory.

Rates of Return

Rates of return measure the net gain or loss of an investment over a specified period, expressed as a percentage of the investment’s initial cost.

Standard Deviations

A measure of variability that quantifies the extent of deviations of a set of data points from their mean.