Question

Consider a Lorenz curve given by

$f(x)=x^n$ for $0x1$ and $n1.$

What happens to the Gini index G$.$ I as $n1,$ and what's the interpretation of that result?

Select the correct answer below:

As $n1,$ G$.$ I $100,$ denoting complete income inequality.

As $n1,G.I0,$ denoting complete income inequality.

As $n1,$ G$.$ I $100,$ denoting perfect income equality.

As $n1,G.I0,$ denoting perfect income equality.