The following diagram shows the Lorenz curves for three countries. Country X\'s

Question

The following diagram shows the Lorenz curves for three countries. Country X's Lorenz curve is shown in blue. Country Y's Lorenz curve is shown in red, and Country Z's Lorenz curve is shown in green. Region I is the area above Country X's Lorenz curve and below the 45-degree line. Region II is the area below Country X's Lorenz curve and above Country Y's Lorenz curve. Region III is the area below Country Y's Lorenz curve and above Country Z's Lorenz curve. Region IV is the area below Country Z's Lorenz curve. The Gini coefficient for Country Y is given by

Explanation / Answer

Black line represents line of pefect equality of income distribution.

Ginni coefficient is ratio of area between 45 degree black line and and Country Y lorenz curve over total area under 45 degree line.

So ginni coefficient for Country Y=( I+II)/(I+II+III+IV)

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