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Measures of Dispersion — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsMeasures of Dispersion4 Marks
Question
Discuss merits and demerits of Lorenz curve.
✓

Answer

Merits:
  1. Lorenz Curve is attractive and it has permanent effect on the mind.
  2. On seeing the diagram, the knowledge of extent of dispersion is obtained.
  3. A comparative study of two or more series can be made very easily.
  4. With the help of Lorenz curve we can study share prices, income, wages, profits etc.
Demerits:
  1. It does not give an exact figure for dispersion.
  2. It is very difficult to draw a Lorenz curve.
  3. It cannot be used when further mathematical treatment is required.

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