Economics • Economic BasicsEasy
What is indicated by a 'Gini Coefficient' of zero?
A. Absolute equality in income or wealth distribution across a population.✓ Correct Answer
B. Absolute inequality where one person holds all wealth.
C. An inflation rate of zero percent in the macroeconomy.
D. Full employment equilibrium with zero cyclical unemployment.
💡 Solution & Explanation
A Gini coefficient of zero represents absolute equality where every single individual possesses an identical share of total income or wealth within the population. Conversely, a coefficient of one signifies absolute inequality where a single entity holds the entire wealth. Development economics questions frequently utilize the Gini coefficient to measure income distribution disparities.
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