An economy has 5 households with annual income (alphabetical order): A - $40,000, B - 30,000, C - 60,000, D - 70,000, E - $50,000. 1. Fill in the following table by ranking households income from low to high. 1st 20% being lowest and 5th 20% the highest. 2. Complete the calculation of cumulative income. 3. To complete the Lorenz curve, we need the share of cumulative income in total income. The cumulative income of low 60% of households has how much share (percentage) in total income? 4. The top 20% household in this economy enjoys how much percentage of total income? Houscholds Rank Cumulative Income Income 1 20% 2nd 20% 3rd 20% 4th 20% sth 20%

An economy has 5 households with annual income (alphabetical order): A - $40,000, B - 30,000, C - 60,000, D - 70,000, E - $50,000. 1. Fill in the following table by ranking households income from low to high. 1st 20% being lowest and 5th 20% the highest. 2. Complete the calculation of cumulative income. 3. To complete the Lorenz curve, we need the share of cumulative income in total income. The cumulative income of low 60% of households has how much share (percentage) in total income? 4. The top 20% household in this economy enjoys how much percentage of total income? Houscholds Rank Cumulative Income Income 1 20% 2nd 20% 3rd 20% 4th 20% sth 20%

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter15: Poverty And Economic Inequality

Section: Chapter Questions

Problem 47P: A group of 10 people have the following annual incomes:...

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