of mcomeOn the Lorenz curve, all of the following are true except:100%50%% of families100%Line B shows less income equality than line C.Line C shows greater income inequality than line A.Line A shows more income inequality than line B.On Line A, 50% of the population earns 50% of the total income

The Lorenz curve is a graphical representation of the distribution of income or distribution of…

Answered: of mcome On the Lorenz curve, all of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Which of the following is not a true statement about the Lorenz curve? A. The Lorenz curve does not consider age differences among wage earners. B. The Lorenz curve does not include unreported income obtained from the underground economy. C. The Lorenz curve does not consider different sizes of households. D. The Lorenz curve includes both money income and income in kind.
The Lorenz curve is used to show which of the following? a. The total income generated from all activities b. The degree of inequality in the distribution of income within a country c. The progressivity of the income-tax structure within a country d. The extent of wage differences among workers in similar occupations e. The change in the poverty rate within a country over time
Indicators of income inequality and poverty Country Gini coefficient Ratio of income at Poverty rates % 90th percentile to 10th percentile households below 50% of average household income Australia 336 4.5 14.6 Belgium 259 3.3 9.4 Canada 324 4.2 12.0 France 293 3.4 7.2 Italy .337 4.3 11.4 Jаpan 329 5.0 15.7 Portugal .353 4.9 11.9 Spain 317 4.6 14.0 Source: OECD 2011 The table shows some selected indicators on income inequality and poverty. Based on these data, which of the following statements are correct? Select one or more answers. Select one or more: O The ratio between households at the 90th percentile and households at the 10th percentile suggests inequality is greater in Japan than in Italy. O Belgium has a higher poverty rate than France. Spain has a higher overall level of income inequality than Australia. O The Gini coefficient for Portugal means the bottom 10% of households have a greater total income than the bottom 10% of households in Canada.
What are the Gini Coefficient and the Lorenz Curve? Be sure to explain how these terms are related and what they are used to measure.
Which of the following statements is correct? OA. The farther the Lorenz curve is from the line of equality, the more unequal is the distribution of income. OB. The Lorenz curve for wealth is closer to the line of equality than the Lorenz curve for income. OC. If the Lorenz curve crosses the line of equality the distribution of income is more unequal at high income levels than at low income levels. D. The closer the Lorenz curve is to the line of equality, the more unequal is the distribution of income. % 5 6 M Oll & 7 8 O ( 9 ) 0 Next It de le S Orie 1 C+ Camp NS T Codin hool S + Mihaile. NS 2 ye ython - ers [Tuta Camp org
The table below shows the share of income going to each quintile of the income distribution for a nation in 1960 and 2010. Use this data to calculate what the points on a Lorenz curve would be, and sketch the Lorenz curve. The purple line represents 1960. The green line represents 2010. Share of income received 1960 2010 Bottom 20% 10% 5% Bottom 40% 30% 10% Bottom 60% 45% 30% Bottom 80% 75% 60% All 100% 100% |100% Provide your answer below: 110 100- -90 -80 (90,0) -70 (100, 70) -60 Perfect Equality (100,50 Year 2010 -50 (80,50) Year 1960 40 (70, 30) 30- (50, 20) 20 (90, 20) 10 (60, 10) 80 100 Income Quintiles 20 40 60 -10 Cumulative Share of Income
The table shows the income shares in the United States and the United Kingdom. Draw the U.K. Lorenz curve and compare it with the Lorenz curve in Fig. 19.3 on p. 441. In which country is income less equally distributed?
Percent of Percent of income income Alpha Beta Household percentage Lowest 20 percent Second 20 percent Third 20 percent Fourth 20 percent Highest 20 percent 9. 10 5 12 10 29 20 40 60 68. The above table shows the distribution of income in two countries, Alpha and Beta. Based on these distributions of income a. Country Beta has more equal distribution than does Country Alpha b. Both countries have equal distributions because 100 percent of the incomes are accounted for c. The Lorenz curve for country Beta is closer to the line of equality d. Country Alpha has a more equal distribution of income than does Country Beta e. It is impossible to answer the question without more information
4. An economist produced the following Lorenz curves for the current income distribution and the projected income distribution 10 years from now in a certain country: Current Lorenz curve: f(x) = 0.15x+0.85x Projected Lorenz curve: g(x) = x'6 Compute the Gini index of income concentration ( to 2 decimal places ) for the current and projected curves. What can you say about the distribution of income 10 years from now? Is it more equitable or less?
Which statements are TRUE? A. Modern sector enlargement assures a better Lorenz Curve for a nation. B. The average poverty gap measures the sum of the differences the income of each person from the absolute poverty line. C. The multidimensional poverty index gives equal weight to all eight indicators. D. The normalized income shortfall is a measure of income inequality.
The figure shows the distribution of pre-tax income for Canadian families in 2015. Distribution of Family Income, 2015 60- Which of the following best describes the distribution of pre-tax earnings? 50- A. Just over 40 percent of families earned less than $40,000 while just over 20 percent of families earned more than $100,000. 41.8% 40- 38.4% B. Nearly 40 percent of families earned less than $40,000 while just under 20 percent of families earned more than $100,000. O C. Just over 20 percent of families earned less than $40,000 while just over 40 percent of families earned more than $100,000. 30- 19.8% O D. Nearly 20 percent of families earned less than $40,000 while just under 40 percent of families earned more than $100,000. 20- 10- $40K to $100K Pre-tax Family Income < $40K $100K and over Percentage of Families
The closer the Lorenz curve for income is to the line of equality, the larger is the nation's total income. the smaller is the nation's total income. the more equally are incomes distributed. the larger the fraction of the nation's income received by the richest families.

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