# Income Gap Ratio Calculator

Introduction

In today’s fast-paced world, understanding financial metrics is crucial. One such metric is the income gap ratio, which provides insights into income inequality within a population. Calculating this ratio can shed light on disparities and help in formulating policies for equitable distribution of resources. This article introduces a simple income gap ratio calculator to aid in this calculation.

## How to Use

To use the income gap ratio calculator, follow these steps:

- Input the total income earned by the higher income group.
- Input the total income earned by the lower income group.
- Click the “Calculate” button to obtain the income gap ratio.

## Formula

The income gap ratio is calculated using the formula:

## Example Solve

Suppose the total income of the higher income group is $200,000 and the total income of the lower income group is $50,000. Using the formula mentioned above:

Thus, the income gap ratio in this scenario is 4.

## FAQ’s

**Q: What does the income gap ratio signify?****A:** The income gap ratio indicates the ratio of total income earned by the higher income group to that earned by the lower income group. Higher values suggest greater income inequality.

**Q: Can the income gap ratio be negative?****A: **No, the income gap ratio is always a positive value.

**Q: How can policymakers utilize the income gap ratio?****A:** Policymakers can use the income gap ratio to identify areas of income inequality and implement targeted interventions for socioeconomic development.

## Conclusion

The income gap ratio calculator provides a convenient tool for assessing income inequality within a population. By understanding this ratio, stakeholders can take proactive measures to address disparities and foster inclusive growth.