Q5. Poverty measures a. The Poverty Gap Index or Normalized Poverty Gap is the Average Poverty Gap divided by the poverty line. Show that the poverty gap index is the FGT index with a = 1 b. A population that has a greater share of extreme poor among the poor will have a higher P2, even if it has the same headcount ratio and poverty gap index as another population. Explain. c. Consider a population with four individuals with incomes y; = {7, 3, 8,4} and a poverty line yp=5. Calculate Po, P₁, and P2.
Q5. Poverty measures a. The Poverty Gap Index or Normalized Poverty Gap is the Average Poverty Gap divided by the poverty line. Show that the poverty gap index is the FGT index with a = 1 b. A population that has a greater share of extreme poor among the poor will have a higher P2, even if it has the same headcount ratio and poverty gap index as another population. Explain. c. Consider a population with four individuals with incomes y; = {7, 3, 8,4} and a poverty line yp=5. Calculate Po, P₁, and P2.
Chapter17: Income, Poverty, And Health Care
Section: Chapter Questions
Problem 7P
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