On the Lorenz curve graph, the area between the line of equality and the Lorenz curve is 2,500, and the entire area beneath the line of equality is 5,000. What does the Gini ratio equal?
What will be an ideal response?
The Gini ratio is the ratio of the area between the line of equality and the Lorenz curve to the entire area beneath the line of equality. So the Gini ratio is 2,500/5,0000 = 0.5.
You might also like to view...
Which of the following statements is true?
A) If a bank lends a sum of $600 to a firm, the sum is a part of the bank's liability. B) If a bank lends a sum of $200 to a household, the sum is a part of the bank's liability. C) If a firm deposits a sum of $500 in a bank, the sum is a part of the bank's assets. D) If a firm deposits a sum of $500 in a bank, the sum is a part of the bank's liability.
In the United States, the government agency requiring that firms that sell securities in public markets adhere to standard accounting principles and disclose information about their sales, assets, and earnings is the
A) Federal Communications Commission. B) Federal Trade Commission. C) Securities and Exchange Commission. D) Federal Reserve System.
The larger the simple deposit multiplier,
A) the higher the required reserve ratio. B) the higher the discount rate. C) the larger the change in the money supply for a given change in deposits. D) the less likely the Fed will be to use its monetary policy tools.
The statement "people should pollute as little as possible" is an example of a
A. non-judgmental statement. B. normative statement. C. factual statement. D. positive statement.