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A-Level Economics · Lorenz curve diagram question

Which distance shows how much redistribution raised the income share of the poorest 70%?

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The answer

The distance A B. Vertical, at one fixed population share: the income share of the poorest 70% rising from 30% to 50%. Measure this shift the way you measure a shift in supply: fix ONE point on the horizontal axis and read the vertical gap between the two curves. At 70% of the population that is A up to B — 30% of income becoming 50%.

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This is one of 6 questions on the lorenz curve diagram — every corner lettered, every wrong answer diagnosed.

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