Final answer:
A nonfunctional mutation in the SRY gene in an XY individual leads to female development due to the disruption of male sexual development pathways. This can result in Swyer syndrome, where the individual develops female characteristics despite having an XY genotype.
Step-by-step explanation:
An XY individual typically develops male characteristics due to the presence of the SRY gene on the Y chromosome, which initiates the development of male sex characteristics. However, if there is a loss-of-function mutation in the SRY gene, the usual pathway to male sexual development is disrupted. Instead, the individual may develop as female because in the absence of SRY gene activity, the default development pathway of the fetus is towards female characteristics.
During fetal development, if there is a mutation causing a nonfunctional SRY gene, the individual would not be exposed to the necessary factors that usually prompt the development of male characteristics. This condition can lead to a syndrome known as Swyer syndrome, where the person has an XY genotype but does not develop male characteristics, instead developing a typically female phenotype.
Thus, the initial statement is true: an XY individual with a loss-of-function mutation in the SRY gene is expected to be female.