A Straight-Line Lorenz Curve Shows

question 108

Multiple Choice

A straight-line Lorenz curve shows

• A) an equal distribution of money income.
• B) a greater than proportionate share of income going to middle-income households.
• C) a high incidence of absolute poverty.
• D) a highly unequal distribution of income.

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Definitions:

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations using its current assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within a year's time, including cash, inventory, and receivables.

Current Liabilities

Short-term financial obligations that are due within one year or within a normal operating cycle.

Ratios

A quantitative relationship between two numbers, showing how many times one value contains or is contained within the other.