Inequality Practice Test

Based on the income distribution shown, two economies (A and B) report the following shares of total annual income by quintile.

Economy A: Bottom 20% = 6%, Second 20% = 11%, Middle 20% = 17%, Fourth 20% = 24%, Top 20% = 42%.

Economy B: Bottom 20% = 3%, Second 20% = 8%, Middle 20% = 14%, Fourth 20% = 22%, Top 20% = 53%.

Which distribution shows greater income inequality?

Based on the income distribution shown, Region 1 reports the following shares of total annual income by quintile: Bottom 20% = 4%, Second 20% = 9%, Middle 20% = 14%, Fourth 20% = 23%, Top 20% = 50%. Region 2 reports: Bottom 20% = 4%, Second 20% = 9%, Middle 20% = 14%, Fourth 20% = 23%, Top 20% = 50%.

Which statement best describes the change in inequality between Region 1 and Region 2?