One Study of the Distribution of Wealth Indicates That the Bottom

question 24

Multiple Choice

One study of the distribution of wealth indicates that the bottom 40 percent of households hold 1 percent or less of total marketable wealth in the United States and the top 1 percent owns close to 40 percent of it. An economist might observe that these data do not include the value of human capital: the value of labor and skills embodied in a person. If we were to include human capital, which of the following people's net worth would change the most?

• A) Debra, who recently received a $25,000 bonus from her job that she has spent on an around-the-world trip
• B) Carol, who has just bought an apartment for $500,000 using savings and bank loans
• C) Betty, who has just retired but expects to live well because her retirement account is worth $1,000,000
• D) Alice, who has just completed her education as a medical doctor and now has student loans of $100,000

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Definitions:

Prize Horse

A highly valued or award-winning horse often recognized in competitive events or breeding.

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A venue within a community that hosts live performances, including plays, musicals, and other stage productions.

Frustrated Contract

A contract that, due to unforeseeable circumstances beyond the control of the parties, cannot be fulfilled, leading to its termination without fault.

Anticipatory Breach

An act where one party ahead of time indicates that they will not fulfill their contractual obligations, allowing the other party to consider the contract broken.