The Lorenz curve of income distribution in North is f(x) = 0.1x4 +0.4x³ +0.3x² +0.2x The Gini coefficient in North is... O...y=0.32 O...y = 0.52 O...y = 0.36 O...y=0.64
Q: Price Level P3 P₂ P₁ Y₁ LRAS Y₂ Y3 SRAS₂ AD₁ SRAS₁ AD₂ Quantity of Output Starting from P2 & Y3…
A: Aggregate demand is the sum of Consumption, Investment, government spending and net export.…
Q: Based on the graph below, explain what would happen to the optimal level of abatement if there were…
A: Social cost of a given output refers to the sum total that is just enough to be paid in the form of…
Q: Problem 8 (Marginality Principle and Profit Maximization II). Correct the following statement. "If…
A: The profit is maximized where the MR = MC. The MR or Marginal revenue refers to the change in total…
Q: What factors will shift the supply and demand for currency?
A: According to economic definitions, money is a good that acts as both a store of value and a means of…
Q: Suppose the populstion is 300 million people. Of these 70 million people are classified as not…
A: Labor Force consists of both employed and unemployed persons. Labor Force = Total Employed + Total…
Q: Peter's TV Supplies is considering a merger with Jan's Radio Supply Stores. Peter's total operating…
A: [a] Average cost of production = [Total cost/ total number of output sold] For Peter =…
Q: A bank determines that it is prudent to hold $4 for every $100 in deposits. The bank holds surplus…
A: Reserve ratio is the part of deposit that is kept by the bank. Reserve ratio is calculated by…
Q: Fill in the blanks to make the following statements correct. a. A regional trade agreement, such as…
A: NAFTA refers to North American Free Trade Agreement that was enacted in Jan 1, 1994. It aimed to…
Q: Currently it takes teo Belize dollars to buy a U.S dollar. If that numbrr were yo rise to three then…
A: Appreciation of a currency is when it can buy more of foreign goods / currency. And depreciation of…
Q: The Federal Environmental Management Agency (FEMA) uses the Command and Control System of managing…
A: A command-and-control rule imposes strict limitations on pollution emissions and/or requires the…
Q: Suppose the following statistics characterize the financial health of the hypothetical economy…
A: Given:- At end of 2017, GDP=$150 billionNational debt=$180 billionBudget deficit=$9 billionDebt…
Q: 1. In a simple economy, people consume only 2 goods, market basket of goods used to compute the CPI…
A: Inflation shows the increase in price level over years. Inflation rate shows the increase in price…
Q: 8. Explain (i) how the standard (neoclassical) downward sloping demand curve is derived from the…
A: Optimal consumption bundle: The optimal consumption bundle is such that at that bundle the…
Q: Consider the competitive market for sports jackets. The following graph shows the marginal cost…
A: Cost curves represent the various levels of costs paid throughout the production of goods. As the…
Q: Identify and discuss the general ways in which companies can increase their profitability and profit…
A: the primary goal of businesses in generating profits and they seek global expansion as they seek…
Q: Refer to Figure 11.3. If the demand for money curve will shift from Md1 to Md0, the equilibrium…
A: The decrease in money demand curve shows the leftward shift of money demand curve. The decrease in…
Q: Consider a market with two firms, Hewlett-Packard (HP) and Dell, that sell printers. Both companies…
A: Pure strategy Nash Equilibrium: Nash equilibrium with 2 players is the strategy profile where both…
Q: True or False: Credit unions use funds for making automobile loans, personal loans, and home…
A: A particular kind of financial cooperative that offers conventional banking services is a credit…
Q: Simple majority rule can generate inefficient outcomes because It does not register the…
A: Voting is a process that can be used by a group, such as an electorate or gathering, to arrive at a…
Q: What is the answer for d and e?
A: Introduction ( General terms) The term "marginal private cost" (MPC) refers to the variation in a…
Q: Q7) At T1, an economy is in long-run equilibrium at a real interest rate of 4%, a price level of…
A: Given information: At time period T1 The real interest rate is 4% The price level is 100 The…
Q: What is the (pure-strategy) Nash equilibrium? O There is no (pure-strategy) Nash equilibrium. O (P1,…
A: The Nash equilibrium refers to the best course of action or strategy provided the strategy of rival…
Q: Neoclassical theory supports the view that the 'market exchange' is the best way to allocate…
A: NEOCLASSICAL THEORY A theory that focuses on the demand and supply being the main driving force…
Q: 5. Suppose a firm's cost function is given as C = 6q+10q2-4142+30 and it must be that 91 +92 = 34.…
A: Cost is minimized where MC = AC MC is the marginal cost and is the cost of producing an additional…
Q: Hendry bought a pair of Nike shoes from New York last summer for US $300. On returning back to…
A: The rate at which one (U dollar) currency is exchanged for other (C dollar) currency is called…
Q: If members of an oligopolistic industry wish to maximize profits for the industry, they will likely…
A: Monopolist: A monopolist is a single seller in the market and hence he faces the downward sloping…
Q: Equilibrium condition: Y=C+I+G+NX a. Solve for equilibrium real income. b. If autonomous real…
A: The national income in the open economy is constituted of the consumption function, investment,…
Q: In moving from 0.4 mg/L to 0.7 mg/L of abatement, show and clearly label on the figure above the…
A: Social cost: Social cost of a given output refers to the sum total that is just enough to be paid in…
Q: A woman deposits $9000 at the end of each year for 10 years in an account paying 3% interest…
A: Present value is the value of investment in today's dollar. Future value is the value of investment…
Q: 8. Suppose U = xx* and our budget is given as p₁x₁+P2x2 = m, where m is our income. Solve for solve…
A: Budget constraints shows the relationship between the two goods , their prices and the income of…
Q: a. b. Quantity Price $70 C. d. 1 12 13 15 16 17 18 19 10 $58 $46 $34 Total Revenue $28 $80 $224 $328…
A: The following formula would be useful to solve this problem: Total Revenue = Price × Quantity…
Q: D(x) is the price, in dollars per unit, that consumers are willing to pay for x units of an item,…
A: Equilibrium point is achieved at the point where the demand and supply functions of the good become…
Q: Suppose that the home country has a monopoly and initially imports at the world price Pw. Use a…
A: Tariff is a type of trade protectionism where importing country imposes a tax on the goods while…
Q: Consider the following graph: Dollars A B C 0 Show Transcribed Text a) $A. b) $B. c) $C. HK d) $N.…
A: A monopolist will produce where MR = MC MR is the marginal revenue. MC is the marginal cost and is…
Q: An open-market sale of securities by the Fed results in ________ in reserves and ________ in the…
A: Open market operation is used to change the money supply. Money supply is the amount of money…
Q: You are the owner of a local Honda dealership. Unlike other dealerships in the area, you take pride…
A: Given:- Price elasticity of demand=-1.8 Total firms=3 Marginal cost=$11000 To calculate:- Price=?…
Q: Suppose the price elasticity of demand for Valencia face-to-face and online classes is 3.83 and .72…
A: The price elasticity of demand shows the percentage change in quantity due to percentage change in…
Q: There has been a 9% increase in the U.S. Consumer Price Index (which measures the average price…
A: Nominal exchange rate is the rate at which the currency of one country is exchanged for the other…
Q: 8. Suppose U=xx!" and our budget is given as P₁x₁+P2x2 = m, where m is our income. Solve for solve…
A: Given utility : U=x1αx21-α Budget Constraint: p1x1+p2x2=m To obtain the optimal values of x1 and x2,…
Q: Toll lanes on a section of the 1-40 freeway are being considered in order to reduce traffic…
A: From the question, Construction Costs = $18,500,000 Operating and maintenance costs = $690,000 per…
Q: The following information is relevant for an individual firm operating in a perfectly competitive…
A: A firm will shut down in short run if it is not able to cover it's variable cost. It will shut down…
Q: Higher inflation makes relative prices Select one: O a. less variable, making it more likely that…
A: Inflation refers to rise in general price level of goods and services. Due to inflation, the…
Q: Derive graphically AS curve and explain in depth why the short-run AS curve is upward sloped
A: The aggregate supply curve is the total production done by firms within the boundaries of a nation…
Q: U(x, y) = xayb A consumer maximises utility subject to a budget constraint M = Pxx+Pyy Where px is…
A:
Q: The market demand for electric cars is given by: Q = 200-P The cost per unit is constant at $40. a.…
A: Monopoly refers to the market system where only single firm exists in the market. the firm is price…
Q: Differentiate geographical pricing from psychological pricing.
A: The process of establishing a manufacturer's value in exchange for their goods and services is known…
Q: An increase in the interest rate will Group of answer choices increase the optimal money balance.…
A: The interest rate is the amount charged by the lender in addition to the principal amount. Taking…
Q: Suppose a bank has $400,000 in deposits and a required reserve ratio of 25 percent. Then excess…
A: Reserve are the part of deposit that is kep by the bank. Required reserve is the product of Reserve…
Q: Problem: Imagine you have two competing athletes who have the option to use an illegal and dangerous…
A: Game theory is the study of how economic actors' interdependent actions lead to results that are…
Q: - The accompanying table shows the percentage accounted for by private savings, investment spending,…
A: Private saving = Y - C - T Public saving (or Budget balance) = T - G Net capital inflow = Import -…
Step by step
Solved in 2 steps
- The Gini coefficient for the nation with Lorenz curve of income distribution fix) = 0.2x +0.3x+0.5x %3D is... O...y 0.4. O...Y = 0.25. Y 0.8. %3D ... O..y = 0.2.QUESTION 43 The Gini coefficient can be approximated from the Lorenz curve by the g=A/(A+B), where A is the area between the Lorenz curve and the 45-degree line and A +B is the area under the 45-degree line. Consider a population with three members and an aggregate income of 100. Which of the following statements are correct? O When the incomes are (50, 50, 0), the approximated Gini coefficient is 0.5. When the incomes for the thre members are (100/3, 100/3, 100/3), the approximate Gini coefficient is 0. O When the incomes are (100, 0, 0), the approximated Gini coefficient is 1. O A gini coefficient of 1 implies complete equality.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. 0,5 100
- 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.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 22.2 = X Suppose that the Lorenz Curve for country A is given by yA and for country B is yB mine which of the two countries has greater inequality in its income -0.3x2 + 0.7x. Use the Gini index to deter- distribution.
- Canada had the following distribution of Income after taxes in 2006 Based on the information in the tables, which one is the correct Gini coefficient of income inequality? Deciles cumulative share of income Lorenz curve for after tax income in Canada 0% (2006) 1 0% 1 2 2%| 3 6% 0.8 4 11% 0.6 18% 0.4 26% 0.2 37% 50% 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 9 67% share of population 10 100% cumulative share of income equidistribution line O a. 0.47 O b. 0.43 O c. 0.42 O d. 0,44 O e. 0.23 O share of incomeWhich of the following statements regarding the Gini coefficient are correct? A. It is the measure of the average difference in income between every pair of individuals in the population. B. It can be calculated exactly as g=A/(A+B), where A is the area between the Lorenz curve and the 45-degree line, and A + B is the area under the 45-degree line. C. The fraction A/(A+B) is an accurate approximation when the population is small. D. If 50% of a large population owned 2% of the wealth each, then the Gini coefficient equals 0.6.No written by hand solution Consider a 100-person economy, where half of the population receives 20% of the total income and the other half the remaining 80%. Using the Lorenz-curve approximation, what is the Gini coefficient in this economy (please use the comma to seprare decimals, such as: x,y)?
- Consider the Lorenz curves for income for Deneb and Elnath as shown in this figure: Lorenz curves for Deneb and Elnath cumullative income share (%) 8 8 2 2 2 2 2 2 2 2 100 90 80 70 60 40 30 Lorenz curve for Elnath 0 0 10 20 30 40 50 60 70 80 90 100 income percentiles Lorenz curve for Deneb [If the image above doesn't appear click here to open it in a new tab.] Which of the following statements is true? [Hint: You do not need to calculate any areas to answer this question correctly!] The relative income inequalities of Deneb and Elnath cannot be determined from the information given. Income inequality is more extreme in Deneb than it is in Elnath. Deneb and Elnath have the same degree of income inequality. Income inequality is more extreme in Elnath than it is in Deneb.Q8.4) Formula for Gini Coefficient from Lorenz CurveA / A + BWhat does the A and B represent?2.1 In an effort to make the distribution of income more nearly equal, the government of a country passes a tax law that changes the Lorenz curve from y = 0.97x for one year to y = 0.33x + 0.67x for the next year. Find the Gini coefficient of income for both years. (Round your answers to three decimal places.) before after Compare the distributions of income before and after the tax law was passed. Interpret the result. O The change increases the difference in incomes. The change makes no difference in incomes. O There is not enough information to compare the incomes. The change decreases the difference in incomes. O The change makes the incomes equal. Need Help? Read It
