Cumulative shares of 4%, 12%, 25% and 47% are compared with 20%, 40%, 60% and 80% under perfect equality. What does this tell you about the Lorenz curve?

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Question

Cumulative shares of 4%, 12%, 25% and 47% are compared with 20%, 40%, 60% and 80% under perfect equality. What does this tell you about the Lorenz curve?

Accepted Answer

It lies well below the line of equality, indicating substantial inequality — Award 1 mark. Every actual cumulative figure falls far short of the equality benchmark, so the curve sags away from the diagonal throughout.

Answer

It coincides with the line of equality

Answer

It lies well below the line of equality, indicating substantial inequality

Answer

It lies above the line of equality

Answer

It cannot be drawn without the Gini coefficient

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