UNIT 06 / MARKET FAILURE AND THE ROLE OF GOVERNMENT

Inequality6.5 test

100 questions with explanations after each answer.

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QUESTION 01 / 100Easy

Based on the figure below, which distribution is more unequal?

QUESTION FIGURE

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Cumulative percentage of households is on the horizontal axis and cumulative percentage of income is on the vertical axis. The 45-degree line of equality and two Lorenz curves, L1 and L2, are shown; L2 bows farther below the equality line than L1.

Select one answerAL1, because it reaches 100 percentBL1, because it lies closer to the line of equalityCL2; it lies farther below equalityDNeither curve represents a distributionEBoth distributions are equally unequal

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Question 1