The Gini Coefficient Is Computed by Dividing the Area

question 2

Multiple Choice

The Gini coefficient is computed by dividing the area

• A)between the line of perfect income equality and the actual Lorenz curve by the area below the Lorenz curve.
• B)below the Lorenz curve by the total area below the line of perfect income equality.
• C)between the line of perfect income equality and the actual Lorenz curve by the total triangular area below the line of perfect income equality.
• D)above the line of perfect income equality by 5.

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Definitions:

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The expenses associated with the use of a product or service, including maintenance, repair, and opportunity costs of capital tied up in ownership.

Nonrenewable Resource

A natural resource that cannot be replenished or takes millions of years to form again, such as coal, oil, and natural gas.

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This concept pertains to the expected earnings or gains that a business anticipates receiving in the upcoming periods.