If the area between the 45-degree line and the Lorenz curve has increased, this means that(1 point)

Question

Responses

labor mobility has decreased.
labor mobility has decreased.

labor mobility has increased.
labor mobility has increased.

income inequality has increased.
income inequality has increased.

income inequality has decreased.
income inequality has decreased.

Answer 1

If the area between the 45-degree line and the Lorenz curve has increased, this means that income inequality has increased.

The 45-degree line represents perfect equality, where everyone has the same income. The Lorenz curve shows the distribution of income. If the area between these two curves increases, it indicates a greater divergence from equality, which suggests that income inequality is on the rise.