Suppose That We Compare Shares of Income Earned by Different

question 190

Multiple Choice

Suppose that we compare shares of income earned by different U.S. groups by dividing all households into five groups. Which of the following statements about the income distribution in the United States is CORRECT?

• A) Shares of income remain roughly constant as we move from the lowest quintile to the highest quintile.
• B) Shares of income decrease as we move from the lowest quintile to the highest quintile.
• C) Shares of income increase as we move from the lowest quintile to the highest quintile.
• D) none of the above

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Definitions:

Empirical Rule

A statistical rule stating that for a normal distribution, nearly all data will fall within three standard deviations of the mean.

Bell-Shaped

Describes the graphical form of a distribution that is symmetric around its mean, visually represented as a bell-shaped curve, typically associated with the normal distribution.

Sample Standard Deviation

A measure of the dispersion or variability of a sample dataset, indicating how much the individual data points differ from the sample mean.

Range

The difference between the highest and lowest values in a dataset, providing a measure of spread.