If a Nation's Lorenz Curve Lies on the 45 Degree

question 105

Multiple Choice

If a nation's Lorenz curve lies on the 45 degree line of income equality, then

• A) more of the nation's income is received by the lowest 25 percent of families than by the highest 25 percent.
• B) every household's income level is different.
• C) more of the nation's income is received by the highest 25 percent of families than by the lowest percent.
• D) the income received by each 25 percent of families is 25 percent of the total income.

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Definitions:

Incurred

Refers to costs or expenses that have been recognized or acquired, usually due to a company's operations or activities.

Interest Expense

The cost incurred by an entity for borrowed funds, representing the price paid for the use of borrowed money or for delaying the repayment of a debt.

Operating Expense

Expenses incurred through normal business operations, like rent, utilities, and payroll.

Income Statement

A report detailing a firm's income, expenditures, and net income or loss for a certain time frame.