The Question of What Constitutes a Fair Distribution of Income

question 70

Multiple Choice

The question of what constitutes a fair distribution of income

• A) has a large consensus among economists and politicians.
• B) can be derived from an analytical model.
• C) has been settled.
• D) is subject to considerable debate and disagreement.
• E) is a non-economic issue,only a moral issue.

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Definitions:

Effective Rate

The interest rate on a loan or financial product that reflects the compounding periods in a year, presenting a true annual rate of return.

Effective Rate

The interest rate for a loan or financial product recalculated from its nominal rate to represent an annual compound interest rate, paid in arrears.

Nominal Interest

The stated interest rate of a bond or loan, not accounting for inflation or the compounding of interest.

Compounded Quarterly

Interest calculation where the interest earned over a quarter is added to the principal for the calculation of future interest, effectively compounding every three months.