Asked by Ruthie Greenberger on Jun 17, 2024
Verified
Perfect income equality would yield a Gini ratio of
A) 2.
B) 1.
C) 0.
D) 0.5.
Gini Ratio
A measure to determine the imbalance in earnings among a community's members, moving from 0, suggesting equality, to 1, suggesting extreme inequality.
Perfect Income Equality
A hypothetical scenario where every individual or household in a society earns exactly the same income, eliminating any income disparity.
- Differentiate between the varied measures of economic inequality, including the Gini ratio and Lorenz curve.
Verified Answer
LR
Lilian Rocel PastranaJun 19, 2024
Final Answer :
C
Explanation :
The Gini ratio measures income inequality within a population, ranging from 0 (perfect equality) to 1 (perfect inequality). A Gini ratio of 0 indicates perfect income equality, where everyone has the same income.
Learning Objectives
- Differentiate between the varied measures of economic inequality, including the Gini ratio and Lorenz curve.