Which one of the following statements about the Gini coefficient is not true?
A)The Gini coefficient reflects the data shown in the Lorenz curve.
B)The Gini coefficient equals zero when there is perfect equality.
C)The Gini coefficient increases as income inequality increases.
D)The Gini coefficient must fall when the amount of income in an economy increases.
E)The Gini coefficient equals one when there is perfect inequality.

Question

Quizplus · Accepted Answer

The Gini coefficient does not necessarily have to fall when the amount of income in an economy increases. In fact, it is possible for the Gini coefficient to increase even as total income in an economy increases. This can happen if the distribution of income becomes more unequal as total income increases, which is often the case in developing countries experiencing rapid economic growth.

Which One of the Following Statements About the Gini Coefficient