A Lorenz Curve Showing the Current Distribution of Pre-Tax Income

Question 65
Multiple Choice

A Lorenz curve showing the current distribution of pre-tax income in Canada is not an entirely accurate depiction of Canadian income distribution because A)Statistics Canada does not actually collect data on Canadian household income. B)Canadaʹs tax-and-transfer system reduces income inequality,which causes the Lorenz curve to be flatter and closer to the diagonal than the pre-tax curve. C)the data collected on Canadian income distribution does not allow for an accurate plotting of a Lorenz curve. D)a Lorenz curve cannot depict the distribution of income after government transfer payments have been distributed to households. E)a Lorenz curve cannot depict the distribution of after -tax income.