An Increase in Income Equality Causes the Lorenz Curve to Become

question 51

True/False

An increase in income equality causes the Lorenz curve to become more bowed away from the line of equality.

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Definitions:

Opportunity Cost

The outcome of selecting an alternative is the exclusion of potential benefits that could have been achieved with other selections.

Equilibrium Output

The level of output at which the quantity supplied equals the quantity demanded, leading to a stable market condition without surplus or shortage.

Purely Competitive Market

A theoretical market structure characterized by an infinate number of buyers and sellers, homogeneous products, and no barriers to entry or exit.

Consumer Surplus

The distinction between what consumers are willing and able to allocate financially for a good or service, and what they actually allocate.