In an Effort to Make the Distribution of Income More

question 141

Multiple Choice

In an effort to make the distribution of income more nearly equal, the government of a country passes a tax law that changes the Lorenz curve from for 2004 to for 2005. Find the Gini coefficient of income for both years. Round your answer to six decimal places. ​

• A)2004: 0.317536 2005: 0.155385
• B)2004: 0.416149 2005: 0.208966
• C)2004: 0.256705 2005: 0.123673
• D)2004: 0.215434 2005: 0.102712
• E)2004: 0.603604 2005: 0.318947

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Definitions:

Total Revenue

The overall amount of money earned by a business for its products or services before any costs or expenses are subtracted.

Marginal Cost

The increase in total cost that arises from producing an additional unit of output, crucial for decision-making in production.

Short-Run Supply Curve

A graphical representation showing the quantity of goods that producers are willing to supply at different prices in the short term, when at least one input is fixed.

Business Owner

An individual or entity that possesses and oversees the operations of a company or enterprise, ensuring its functionality and aiming for its success.