F.5_Econ_Book 3_Chapter 18_0129

Which of the following tools can be used to measure income inequality?

(1) Gini coefficient

(2) Lorenz curve

(3) GDP & GNI

• (1) and (2) only

• (1) and (3) only

• (2) and (3) only

• (1), (2) and (3)

The Gini coefficient

• A.  reflects an economy’s income level.

• B.  reflects an economy’s cost of living.

• C.  must increase over time.

• D.  must lie between 0 and 1.

When the problem of income inequality worsens,

• A.  the Gini coefficient increases.

• B.  the Lorenz curve is closer to the 45-degree line.

• C.  the low-income group becomes worse off.

• D.  the high-income group becomes better off.

Which of the following are correct?

(1)  An increase in the Gini coefficient indicates that income distribution becomes more unequal.

(2)  When the Gini coefficient is equal to 0, the economy has achieved absolute income equality.

(3)  When the Gini coefficient increases, the Lorenz curve is closer to the 45-degree line.

• A.  (1) and (2) only

• B.  (1) and (3) only

• C.  (2) and (3) only

• D.  (1), (2) and (3)

 

Country A's Gini coefficient 0.342

Country B's Gini coefficient 0.482 

Which of the following is INCORRECT?

• A.  Country B’s Gini coefficient is higher than Country A’s.

• B.  Country B’s people earn a lower income than Country A’s.

• C.  Country A’s income distribution is more even.

• D.  Country A’s Lorenz curve is closer to the 45-degree line.

Which of the following may cause income inequality?

(1) Differences in age

(2) Differences in academic qualifications

(3) Differences in working experience

• A. (1) and (2) only

• B. (1) and (3) only

• C. (2) and (3) only

• D. (1), (2) and (3)