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- Q2] Compute the Gini coefficient assuming the region beneath the two respective Lorenz curve is 0.4 for country A and 0.2 for country B.Q8.4) Formula for Gini Coefficient from Lorenz CurveA / A + BWhat does the A and B represent?The table below presents the percentage of total income that goes to a certain fraction of the population of the country of Sanaton. For example, according to the table, the bottom 40% of the population owns 25% of the total income generated in Sanaton. What is the income share of the third quintile? Cumulative percentage of population 20 40 60 80 100 Cumulative percentage of income owned 15 25 40 60 100
- 5- Calculate Gini coefficient for a country with the following deciles in income share data: Country X: 30 (richest quantile) 20 What is the area under the Lorenz Curve? Please show your diagram. 10 5 5 5 5 3 2-Suppose Country A and Country B have the followingpopulation and income distributions: Draw a Lorenz Curve for each country. Additionally, comment on which country ismore unequal.According to the News Wire “Inequality,” what is the average per capita income in nations where the highest-income decile gets; (a) over 45 percent of totalincome? (b) less than 30 percent of total income?
- 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.The table below presents the percentage of total income that goes to a certain fraction of the population of the country of Sanaton. For example, according to the table, the bottom 40% of the population owns 25% of the total income generated in Sanaton. What is the income share of the richest quintile (fifth quintile)? Just enter the number, without % sign. Cumulative percentage of population 20 40 60 80 100 Cumulative percentage of income owned 15 25 40 60 100Q8.2) Lorenz CurveA curve illustrating the degree of equality of income distribution in an economy. It plots thecumulative percentage of income received by cumulative shares of the population. Where dowe fare as a country on the Lorenz curve and what does it say about South Africa’s incomedistribution
- Cumulative percentage of income 90 80 70 60 50 40 30 20 10 O d 40 20 60 80 Cumulative percentage of population If the area of inequality (area between the line of perfect equality and the Lorenz Curve) equals 0.35 and the area beneath the line of perfect equality (given by OAB in the diagram) equals 0.7, calculate the Gini coefficient. A O AOS о в. 0,6 OC. It is impossible to calculate with the information provided. OD. 0,5 100Indicators of income inequality and poverty Country Gini coefficient Australia Belgium Canada France Italy Japan Portugal Spain .336 259 .324 .293 .337 .329 .353 .317 Ratio of income at 90th percentile to 10th percentile 4.5 3.3 4.2 3.4 4.3 5.0 4.9 4.6 Poverty rates % households below 50% of average household income 14.6 9.4 12.0 7.2 11.4 15.7 11.9 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: The Gini coefficient for Canada means the bottom 10% of households have a greater total income than the bottom 10% of households in Italy. France has a lower overall level of income inequality than Japan. The ratio between households at the 90th percentile and households at the 10th percentile suggests inequality is greater in Australia than in Belgium. Spain has a lower poverty rate than Portugal.a. What is the Gini Coefficient and how is it useful for a third world country.b. Using the following information provided in the table below, calculate the Gini coefficient for Algura. Population 10 32 15Income per monthper person 2000 96000 1500Total Population 57 c. Calculate the new Gini Coefficient for Algura when income changes as follows: Population 10 32 15Income per monthper person 1200 78000 900Total Population 57 d. As an economist what are some policy recommendation to improve the Gini coefficient for Algura. Do you think enough information was provided to make recommendation.Explain. PLEASE ANSWER D.