The Closer the Lorenz Curve Is to the Line of Equality

question 111

Multiple Choice

The closer the Lorenz curve is to the line of equality,

• A)the more equal is the distribution.
• B)the less equal is the distribution.
• C)the more unfair is the income distribution.
• D)the richer are the highest 5 percent of households.
• E)the poorer are the highest 5 percent of households.

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Definitions:

Capital Gain Transactions

Deals involving the sale of an asset, such as stocks, bonds, or real estate, where the sale price exceeds the purchase price, resulting in income that can be taxed at preferential rates.

Form 1099-B

A form used by brokers and barter exchanges to report proceeds from transactions to the taxpayer and the IRS.

Form 8949

A tax form used by the IRS to report sales and other dispositions of capital assets.

Outstanding Receivables

are amounts owed to a business by its customers for goods or services delivered but not yet paid for.