1 d e 1. Due to the creation of the multiverse, two parallel universes, Universe 30.13 and Universe 30.14,were formed. Suppose that the equations of the Lorenz curves of Universe 30.13 and Universe30.14, respectively, are given as follows:f (x) = 0.1x + 0.9x²g (x) = ax1.5 + b(a) Find the Gini index of f(x).(b) Find the values of a and b so that the income distributions between the two universes arethe same. Show complete solutions.(c) What percent of total income does the poorest 25% of Universe 30.13 receive? Whatpercent of total income does the richest 10% of Universe 30.13 receive?(d) Suppose that the Gini index of a third parallel universe, Universe 30.15, is lower than thatof Universe 30.13. If we will compare the graphs of the Lorenz curves of the two universes,which Lorenz curve is closer to the line y = x? Explain.(e) If the Gini index of Universe 30.15 is given to be 0.4441, is it correct to say that Universe30.13 is wealthier than Universe 30.15? Justify your answer.

Gini index is the area between the uniform equality line and the Lorrenz curve . Area under…

1. Due to the creation of the multiverse, two parallel universes, Universe 30.13 and Universe 30.14, were formed. Suppose that the equations of the Lorenz curves of Universe 30.13 and Universe 30.14, respectively, are given as follows: f (x) = 0.1x + 0.9x² g (x) = ax.5 + b (a) Find the Gini index of f(x). (b) Find the values of a and b so that the income distributions between the two universes are the same. Show complete solutions. (c) What percent of total income does the poorest 25% of Universe 30.13 receive? What

1. Due to the creation of the multiverse, two parallel universes, Universe 30.13 and Universe 30.14, were formed. Suppose that the equations of the Lorenz curves of Universe 30.13 and Universe 30.14, respectively, are given as follows: f (x) = 0.1x + 0.9x² g (x) = ax.5 + b (a) Find the Gini index of f(x). (b) Find the values of a and b so that the income distributions between the two universes are the same. Show complete solutions. (c) What percent of total income does the poorest 25% of Universe 30.13 receive? What

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter12: Income Distribution, Poverty, And Discrimination

Section: Chapter Questions

Problem 17SQ

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