The above figure shows the Lorenz curves for four different countries. Which of the following statements CAN be made on the basis of the graph?
A) Country C has the best balance between equity and efficiency.
B) Country A is a socialist country.
C) The income distribution is more equal in country B than in country D.
D) all of the above
C
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The unemployment caused by minimum wage would be larger if
A) both labor demand and labor supply are more elastic. B) both labor demand and labor supply are more inelastic. C) minimum wage is set equal to the equilibrium wage rate. D) minimum wage is set below the equilibrium wage rate. E) both labor demand and labor supply are perfectly inelastic.
A monopolist hires fewer workers than a perfectly competitive industry, other things being equal, because
A) a monopolist has to pay higher wages in order to attract additional workers. B) the monopolist substitutes more capital for labor when compared to a competitive industry. C) the monopolist producer has to deal with unions and face higher wages than do competitive industries. D) the monopolist produces less output than a competitive industry.