FIGURE 13- 1
-Refer to Figure 13- 1. The diagonal line in the diagram
A) has no real purpose.
B) shows where the Lorenz curve would be if there were complete income equality.
C) illustrates the functional distribution of income.
D) shows the actual distribution of income.
E) shows that 100 percent of families earn 100 percent of the income.

Question

FIGURE 13- 1
-Refer to Figure 13- 1. The diagonal line in the diagram
A) has no real purpose. 
B) shows where the Lorenz curve would be if there were complete income equality. 
C) illustrates the functional distribution of income. 
D) shows the actual distribution of income. 
E) shows that 100 percent of families earn 100 percent of the income.

Quizplus · Accepted Answer

The diagonal line in the diagram represents perfect income equality, meaning all households or individuals have the same income. The Lorenz curve, which shows the actual distribution of income, will always lie below this line.

FIGURE 13- 1 -Refer to Figure 13- 1. the Diagonal Line in the Line