Question 1

The distribution of income in the United States is skewed so that the mode level of household income is ________ the median household income and the median household income is ________ than the mean household income.

Accepted Answer

The mode is the most frequently occurring value in a distribution, while the median is the middle value when the values are arranged in order from smallest to largest. The mean is the average of all the values in a distribution. In a skewed distribution, the mode is typically less than the median, and the median is less than the mean.

Question 2

The median household income is

Accepted Answer

The median household income is the income level at which half of the households earn more and half earn less, effectively dividing the income distribution into two equal parts.

Question 3

In the United States the poorest 20 percent of households receive about ________ of total income.

Accepted Answer

The poorest 20 percent of households in the United States receive about 3 percent of total income, reflecting significant income inequality.

Question 4

-An economy has the income shares information in the table above. Which of the following is TRUE?

Accepted Answer

Income in the U.S. economy is generally less equally distributed compared to many other countries, and the table likely represents a more equal distribution than what is typically observed in the U.S.

Question 5

The Lorenz curve graphs the

Accepted Answer

The Lorenz curve is a graphical representation of the distribution of income or wealth within a society, plotting the cumulative percentage of total income received against the cumulative percentage of recipients, starting with the poorest.

Question 6

A Lorenz curve graphs the

Accepted Answer

A Lorenz curve is a graphical representation that shows the cumulative distribution of income or wealth, plotting the cumulative percentage of total income or wealth against the cumulative percentage of households, starting with the poorest.

Question 7

The distribution of income in the United States is characterized by the following relationship between the mean, median, and mode incomes

Accepted Answer

In a positively skewed distribution, which is typical for income, the mode is less than the median, which is less than the mean.

Question 8

The distribution of U.S. income is NOT bell-shaped because

Accepted Answer

The distribution of U.S. income is skewed to the right, meaning there are more households with incomes below the mean than above it, which is why it is not bell-shaped.

Question 9

In the United States, the median household income is ________ than the mean income, which means there are ________ households with low incomes than with high incomes.

Accepted Answer

The median income is typically less than the mean income because the mean is skewed by high-income households. This indicates there are more households with low incomes than with high incomes.

Question 10

The mean household income is

Accepted Answer

The mean household income is calculated by adding up all the household incomes and dividing by the number of households, which gives the average income.

Question 11

Market income is

Accepted Answer

Market income includes all income earned in factor markets, including wages, interest, rent, and profit.

Question 12

As a tool that is used to measure inequality in the distribution of income, the Lorenz curve graphs

Accepted Answer

The Lorenz curve is a graphical representation that plots the cumulative percentage of total income received against the cumulative percentage of recipients, typically households, to illustrate income distribution inequality.

Question 13

The income distribution in the United States is

Accepted Answer

The income distribution in the United States is positively skewed because a small number of people earn significantly higher incomes, pulling the average up, while most people earn lower incomes.

Question 14

Market income is

Accepted Answer

Market income includes wages, interest, rent, and profit earned in factor markets, without any government cash payments.

Question 15

In the United States

Accepted Answer

The mean income is affected by high-income earners, making it higher than the median. Therefore, more households have incomes below the mean than above it.

Question 16

Mode income is

Accepted Answer

The mode is the value that appears most frequently in a data set, so mode income refers to the most common income level.

Question 17

The "mode" household income is

Accepted Answer

The mode is the most common value in a dataset.

Question 18

In the United States the richest 20 percent of households receive about ________ of total income.

Accepted Answer

The richest 20 percent of households in the United States receive about 50 percent of the total income, reflecting significant income inequality.

Question 19

Money income is

Accepted Answer

Money income includes market income plus any cash payments received from the government, such as social security or unemployment benefits.

Question 20

In the United States, the percentage of households that have incomes below the mean income is

Accepted Answer

The mean income is affected by high-income earners, which skews the distribution. Therefore, more than 50% of households have incomes below the mean.

Quiz 19: Economic Inequality

The distribution of income in the United States is skewed so that the mode level of household income is the median household income and the median household income is than the mean household income.

The median household income is

In the United States the poorest 20 percent of households receive about ________ of total income.

-An economy has the income shares information in the table above. Which of the following is TRUE?

The Lorenz curve graphs the

A Lorenz curve graphs the

The distribution of income in the United States is characterized by the following relationship between the mean, median, and mode incomes

The distribution of U.S. income is NOT bell-shaped because

In the United States, the median household income is than the mean income, which means there are households with low incomes than with high incomes.

The mean household income is

Market income is

As a tool that is used to measure inequality in the distribution of income, the Lorenz curve graphs

The income distribution in the United States is

Market income is

In the United States

Mode income is

The "mode" household income is

In the United States the richest 20 percent of households receive about ________ of total income.

Money income is

In the United States, the percentage of households that have incomes below the mean income is