I. How does income level correlate to the likelihood of having investments?
Income level is often correlated with the likelihood of having investments. Higher income individuals are more likely to have investments compared to those with lower incomes. This correlation can be explained by the fact that individuals with higher incomes have more disposable income that they can allocate towards investments. Investing is a way to potentially grow wealth, and those with higher incomes may have both the financial means and the knowledge to engage in investment opportunities.
II. Why does the median holding value jump significantly between families earning under [tex]$100,000 and families earning more than $[/tex]100,000?
When looking at the median holding value, we observe a significant jump between families earning under [tex]$100,000 and those earning more than $[/tex]100,000. This increase can be attributed to the fact that families with higher incomes have more financial resources available for investing. They can afford to invest larger amounts of money, which can lead to higher median holding values compared to families with lower incomes. Additionally, families earning more than $100,000 may have access to a wider range of investment opportunities that can potentially yield higher returns, further contributing to the increase in median holding values.
