Today, the Gini Coefficient of Income Inequality for the United

question 69

Multiple Choice

Today, the Gini coefficient of income inequality for the United States is about .5. In 1975, it had been about .4. What do these numbers tell us?

• A) Wealth is distributed less equally than income.
• B) The number of rich people has fallen.
• C) Income has become more unequally distributed.
• D) The official definition of poverty has changed.

---

Definitions:

Journal Entries

Records of financial transactions in the accounting system, showing accounts affected, amounts, and date.

Allowance Account

An account used in accounting to reflect anticipated losses from accounts receivable that might not be collected.

Direct Write-Off Method

A method of accounting for bad debts whereby companies directly remove (write off) uncollectible amounts from accounts receivable when they are deemed uncollectible.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate income and expenditure to the appropriate period.