(b)The Lorenz functions of income in a population of teachers and administrationemployees of a certain school are given byL₁ (x) = 0.6x² +0.4x,andrespectively.L₂(x) = 0.3x² +0.7x,Which group of employees is more uniformly distributed? Explain. 1. The Gini coefficient is often used to measure inequality.The Lorenz curveThe shaded region S iscalled a concentration areaThe Gini coefficient equals two concentration areas, i.e., G = 2S. When the value ofthe Gini coefficient is close to 0, the underlying distribution is almost uniform, whereasthe value close to 1 indicates a maximal inequality, i.e., a total wealth of a populationis concentrated in hands of one man.

A Lorenz curve graphically represents how income is distributed in a population. The Gini…

(b) The Lorenz functions of income in a population of teachers and administration employees of a certain school are given by L₁ (x) = 0.6x² +0.4x, and respectively. L₂ (x) = 0.3x² +0.7.x, Which group of employees is more uniformly distributed? Explain.

(b) The Lorenz functions of income in a population of teachers and administration employees of a certain school are given by L₁ (x) = 0.6x² +0.4x, and respectively. L₂ (x) = 0.3x² +0.7.x, Which group of employees is more uniformly distributed? Explain.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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