Chapter 12.1 Flashcards
1
Q
Economic inequality
A
The degree that people in a population differ in their ability to satisfy their economic needs
2
Q
Quintile
A
A 20% portion of a country’s population
3
Q
Lorenz curve
A
A curve used to show the degree of income inequality in an economy
4
Q
How do you know a country is closer to perfect income equality on a Lorenz curve?
A
The curve is closer to the diagonal representing perfect income equality
5
Q
Gini coefficient formula
A
Area of space between diagonal and Lorenz curve divided by entire area under diagonal
6
Q
Gini coefficient
A
A summary measure of income inequality
7
Q
The closer the Gini coefficient to 0, the __ the income equality
A
Greater
8
Q
The closer the Gini coefficient to 1, the __ the income inequality
A
Greater
