Government transfer programs result in a U.S. Lorenz curve that is closer to the diagonal line than would be the case without the programs.

Question

Quizplus · Accepted Answer

Government transfer programs, such as Social Security and Medicaid, aim to redistribute income and reduce poverty. As a result, these programs help to decrease income inequality and shift the distribution of income towards lower-income households. This is reflected in a U.S. Lorenz curve that is closer to the diagonal line, which represents perfect income equality, than it would be without these programs. Therefore, the statement is true.

Government Transfer Programs Result in a U