Question : Assertion: The Gini coefficient is used to measure income inequality within a country.
Reason: Higher Gini coefficients indicate higher levels of income inequality.
Option 1: Both assertion and reason are true, and the reason is the correct explanation of the assertion.
Option 2: Both assertion and reason are true, but the reason is not the correct explanation of the assertion.
Option 3: Assertion is true, but the reason is false.
Option 4: Assertion is false, but the reason is true.
Correct Answer: Both assertion and reason are true, and the reason is the correct explanation of the assertion.
Solution : The correct answer is (a) Both assertion and reason are true, and the reason is the correct explanation of the assertion.
The assertion is true. The Gini coefficient is a commonly used statistical measure to assess income inequality. It quantifies the extent to which the distribution of income or wealth among individuals or households deviates from perfect equality. The Gini coefficient provides a numerical value between 0 and 1 , where 0 represents perfect equality (all individuals have the same income) and 1 represents extreme inequality (one individual has all the income).
The reason is the correct explanation of the assertion. A higher Gini coefficient indicates a greater income inequality within a country. As the Gini coefficient increases, it signifies that the income distribution is becoming more skewed, with a larger proportion of income concentrated among a smaller percentage of the population. In other words, a higher Gini coefficient implies that there is a larger gap between the rich and the poor in terms of income.
Therefore, both the assertion and reason are true, and the reason is the correct explanation of the assertion. The Gini coefficient is a widely recognized measure of income inequality, and a higher Gini coefficient signifies higher levels of income inequality within a country.
