When the Lorenz Curve Moves Closer to the Diagonal, This

question 81

Multiple Choice

When the Lorenz curve moves closer to the diagonal, this shows:

• A) the rich getting richer and the poor getting poorer.
• B) total income is rising.
• C) the distribution of income is becoming more even.
• D) the population is decreasing.
• E) the prices of goods are rising.

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Definitions:

Stock Dividend

A distribution of a corporation's earnings to its shareholders in the form of additional shares, rather than cash.

Total Equity

The residual interest in the assets of a business after deducting liabilities, representing the shareholders' ownership interest.

Retained Earnings

Retained Earnings are the portion of a business's profits not distributed to shareholders as dividends, but kept in the company to reinvest in the business or pay off debt.

Liquidating Dividend

A type of dividend paid by a company to its shareholders out of its capital base, indicating a return of some of the original investment rather than profit.