8. In 2004, the distribution of net worth within the United States was as given in the following table: 1 PERCENTAGE OF POPULATION 0.4 0.6 0.8 0.9 0.95 0.99 0.002 0.04 0.153 0.287 0.41 0.656 1 PERCENTAGE OF WEALTH (Source: Prof. E. N. Wolff, Levy Institute of Economics at Bard College, 2007.) a) According to the table, what percentage of net worth was held by the top 1% ? (Hint: What percentage did the other 99% hold?) b) Use regression to fit an exponential function g(x)= a b* to these data. c) Determine the area between the line of equality and the graph of g(x) over the interval [0,1]. (Hint: Integrate a b* using formula 11 from Table 1 in Section 4.7.) d) Determine the Gini coefficient and the Gini index. (Note: E. N. Wolff calculated the Gini coef- ficient as 0.829.) e) What percentage of the net worth was held by the lowest 50% of the population? f) What percentage of the net worth was held by the top 15% of the population?
8. In 2004, the distribution of net worth within the United States was as given in the following table: 1 PERCENTAGE OF POPULATION 0.4 0.6 0.8 0.9 0.95 0.99 0.002 0.04 0.153 0.287 0.41 0.656 1 PERCENTAGE OF WEALTH (Source: Prof. E. N. Wolff, Levy Institute of Economics at Bard College, 2007.) a) According to the table, what percentage of net worth was held by the top 1% ? (Hint: What percentage did the other 99% hold?) b) Use regression to fit an exponential function g(x)= a b* to these data. c) Determine the area between the line of equality and the graph of g(x) over the interval [0,1]. (Hint: Integrate a b* using formula 11 from Table 1 in Section 4.7.) d) Determine the Gini coefficient and the Gini index. (Note: E. N. Wolff calculated the Gini coef- ficient as 0.829.) e) What percentage of the net worth was held by the lowest 50% of the population? f) What percentage of the net worth was held by the top 15% of the population?
Chapter17: Development Economics
Section: Chapter Questions
Problem 2E
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