Which of the following measures income inequality by calculating the ratio of the area between the Lorenz curve and the line of absolute equality to the total area beneath the line of equality?

💡 Solution & Explanation

The Gini coefficient is calculated mathematically from the Lorenz curve as the ratio of the area between the line of absolute equality and the Lorenz curve to the total area beneath equality. Values range from zero representing complete equality to one indicating maximum income inequality. It remains the most widely utilized statistical metric for assessing income distribution across economies.