As the area between the Lorenz curve and diagonal gets smaller,the Gini ratio:

Question

Quizplus · Accepted Answer

The Gini ratio measures inequality in a distribution of a variable, such as income or wealth. The Lorenz curve shows the cumulative percentage of the variable owned by the corresponding cumulative percentage of the population. When the Lorenz curve is closer to the diagonal line of perfect equality, the area between them is smaller, indicating less inequality. As a result, the Gini coefficient will decrease (fall) as the gap between the rich and the poor narrows. Therefore, the correct option is D, which states that the Gini ratio falls to reflect greater equality.

As the Area Between the Lorenz Curve and Diagonal Gets