=The $1.4 billion trick to make us accept income inequalityLotteries take money from the poor and redistribute it unequally. The poor, the uneducated, and minorities play the lotterythe most, and it takes a big chunk of their income.Source: The Huffington Post, January 12, 2016If the news clip is correct, how does a lottery change the distribution of income? Draw two Lorenz curves to illustrate youranswer.CIDLotteries result in the distribution of incomeOA. becoming more unequalOB. becoming more equalOC. remaining unchangedDraw the Lorenz curve in a country that does not have lotteries. Label it Before.Draw the Lorenz curve for the country after the introduction of lotteries. Label it After.>>> To reposition the label click on the cross by the label box and drag it.Cumulative percentage of income100-80-60-020406080100Cumulative percentage of households>>> Draw only the objects specified in the question.40-20-

Income Inequality is defined as the unequal distribution of income in an economy. It is the…

Answered: Lotteries result in the distribution of…

Business

Economics

Lotteries result in the distribution of income

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter20: Income Inequality And Poverty

Section: Chapter Questions

Problem 5PA

See similar textbooks

Related questions

Q: A___________is a formal contract governed by law formed between the seller and the buyer that…

A: The Sale of Goods Act, 1930 defines a contract between seller and buyer.

Q: Given a firm's total cost function: TC = 50 +2Q +2Q², where Q is the quantity of output. Solve for…

A: Cost of production undergoes change when output increase or decrease.

Q: competition Consider the monopolistically competitive market structure, which has some features of a…

A: Introduction 1. Price-takers are prevalent in most competitive markets. Consumers will just obtain…

Q: Section 2: Short Essay Questions: 1. A source of constant discussion among applied econometricians…

A: Regressions are used to quantify the link between one variable and the other factors that are…

Q: ons: Enter your answers as whole numbers. s each country's cost ratio of producing plums and apples?…

A: DISCLAIMER “Since you have asked multiple question, we will solve the first three subparts for you…

Q: Question 1 a. Draw a production possibilities curve for a hypothetical economy producing capital…

A: Hi! Thank you for the question As per the honor code, We’ll answer the first question since the…

Q: Prospect X = ($4, 0.04 ; $15, 0.05 ; $24, 0.01 ; $38, p) What is the expected value of prospect X?

A: Given prospect Prospect X = ($4, 0.04 ; $15, 0.05 ; $24, 0.01 ; $38, p)

Q: A couple recently got preapproved on a loan for their first house purchase. They are speculating on…

A: Low bid refers to the minimum amount of bid that a buyer can bid. This is possible if a seller is…

Q: GMA will be visiting an automobile plant. It was decided by the plant management that they must…

A: Boysen Cost of Paint = 70 per gallon Covers = 350sq. ft per gallon time period = 5 years applied…

Q: What are the items that make opportunity cost differ from the accountant's measure of cost? A firm's…

A: A firm's opportunity cost is the cost foregone in terms of the next best alternative to pursue the…

Q: The major benefit of socialism is that it creates strong incentives to work hard and take the risks…

A: It is a popular economic and political structure based on public ownership of the means of…

Q: Higher domestic prices will cause consumption; decrease; decrease O investment; increase; increase O…

A: Aggregate demand is the sum of consumption, investment, government spending and net exports in an…

Q: In recent years, China has helped make its currency ____ by ____ U.S. dollars. stronger; buying…

A: The answer is - (a) stronger; buying In recent years, China has helped make its currency…

Q: Qd=88 000-200P+ 0.3M-1000PR MC 90 +0.09Q TVC = 48Q TFC = 650 000 where Quis quantity demanded, P is…

Q: If a firm can observe a buyer's characteristics then it can charge different prices as a function of…

A: The measure that depicts charging customers different prices for the same goods and services being…

Q: Find the present value of a PHP 120,000 annuity payable every year for 10 but deferred 3 years.…

A: The given values Deferred years (t)=3 Annuity payable years(n)=10 Annuity value (A)=120000 money…

Q: If the reserve ratio is 12.5%, the deposit multiplier is: Select an answer and submit. For keyboard…

A: The money multiplier is a measure of change in total money supply because of a change in the…

Q: Harry and Sally own a dog-walking service. Their service includes driving to their customer's homes;…

A: Given information Originally charged value=$20 Changed price=$15 Fixed cost=$350 per month Variable…

Q: Question 44 If a $35 billion increase in government expenditures increases equilibrium GDP by $175…

A: Change in GDP id $175 billion due to change in $35 billion government expenditure.

Q: In the Baumol-Tobin view of the transactions demand for money Economic agents do not adjust their…

A: In economics, there are different models to explain the nature of money in the market and in…

Q: Eddie Confess Sharon OD) Keep quiet 25 years in jail 40 years in jail Confess 25 years in jail Goes…

A: Definition of dominant strategy. It is a strategy that gives maximum payoff to a player irrespective…

Q: The CPI measures the pace of inflation or deflation. True or False True False

A: CPI( consumer price index) is the price of weight average of a consumption basket.

Q: Resource development is Multiple Choice the part of economics that looks at the operation of a…

A: Resource development refers to the development of resources in an economy. Resources should be used…

Q: What are the failures of the world bank business indicators?

A: A business can be defined as a commercial activity that seeks to profit by providing goods and…

Q: In a perfectly competitive market for a good with a downward sloping demand curve and an upward…

A: The measure that depicts benefits or costs that are not being not received or incurred financially…

Q: The marketing team of "Hi" restaurant reduced the price of their special triple-decker with double…

A: Break even point refers to a level of output at which the total cost of production of a firm is…

Q: Suppose that the marginal propensity to consume is 0.75. If the government decreases spending by…

A: The Marginal Propensity to Consume (MPC) is a metric that assesses how sensitive consumption is to…

Q: Year: 2021 Value added of agriculture, fishery and forestry sector Value added of industry sector…

A: * SOLUTION :- Given that ,

Q: The following graph shows the market for bank reserves in a hypothetical economy. Suppose the price…

A: Impact of decrease in the overall price level is shown in the below graph…

Q: Suppose the Fed decided to purchase $100 billion worth of government securities in the open market.…

A: Government securities worth= $100 billion

Q: v V V Consumer preferences are changed A firm that is a leader in an industry obtains a higher…

A: CONSUMER BEHAVIOUR Consumer behavior is the study of the consumers in the market. It studies the…

Q: rue or False: The government securities purchased by the Federal Reserve (“the Fed”) in normal…

A: The US Federal Reserve manages the money supply through open market operations, which involve…

Q: What are the Cost and then benefits of contractionary fiscal type in the economy

A: The policy that is used by the government during high phases of growth of the economy is being known…

Q: 37

A: Market refers to the place where the buyers and sellers sell the product at the given price. It…

Q: 4) Refer to the graph below. Using the midpoint elasticity formula, the value of price elasticity of…

A: Elasticity of demand is an important economic concept used to determine the extent to which a…

Q: What are some applicable employment related laws in Canada? (i.e. equal employment, compensation,…

A: here we find some applicable employment related laws in Canada (i.e. equal employment,…

Q: Investment is a larger portion of GDP than consumption, but is substantially less volatile…

A: Boom It is a phase where there is a rise in economic activities in an economy. This implies there…

Q: Data for 2018 Data for 2019 Quantity 4 Item: Price Price Hot dogs $1.75 $2.00 Pepsi 2 $1.25 3 $1.50…

A: The GDP is computed by multiplying the quantity of each commodity by its price and then adding all…

Q: very and sells its product in a competitive price-taker market. Product Total Output (dollars) Price…

A: Marginal revenue(MR) is the expansion in income that outcomes from the offer of one extra unit of…

Q: MULTIPLE CHOICE (identify the one best answer below and explain your reasoning for each option): The…

A: The illegal activities lead to the black economy. Such black activities are not recorded in official…

Q: Done 1 2 3 I Undertanding the determinants of Supply and Demand, and the impact on Changes to…

A: The correct answer is given in the second step.

Q: Many cities have taxes on products that are considered "bad," like cigarettes and alcohol. These…

A: The government has long taxed tobacco and alcoholic beverages. Sugar-sweetened beverage levies have…

Q: Interest rate spread Suppose that a 5-year Treasury bond pays an annual rate of return of 2.9%, and…

A: An interest rate can be defined as the amount charged by a lender to a borrower for any sort of…

Q: Consider an AS AD diagram. What would happen in the model if Energy prices increased? Group of…

A: Real GDP is the value of final goods and services produced in the economy within a given period of…

Q: In recent years, almost all new job creation in the United States has occurred in the sector.…

A: The process of creating new jobs, particularly for those who were previously unemployed or inactive,…

Q: Briefly discuss the obligations of both the seller and the buyer as recognized in our law.

A: Answer explain in step 2

Q: 1. The Following equations describe an economy: Y=C+I+G C = 240 +0.5(Y-T) I = 200-10r G = 100 T = 80…

A: GDP is the sum of consumption, investment and government spending in a closed economy. At…

Q: Long-run: Assume you are examining the economy of India. Assume the Indian economy is initially in…

A: The economy is already at full employment level or economy is operating at equilibrium level. In the…

Q: Superconductor technology is becoming a widespread and indispensible component of the machines we…

A: The Long-run average cost curve is defined as a curve which portrays a firms lowest cost per unit at…

Q: Fiscal policy involves increases or decreases in Multiple Choice O interest rates. the money supply.…

A: Fiscal policy basically refers to the use of government spending and taxation to influence the…

Question

=
The $1.4 billion trick to make us accept income inequality
Lotteries take money from the poor and redistribute it unequally. The poor, the uneducated, and minorities play the lottery
the most, and it takes a big chunk of their income.
Source: The Huffington Post, January 12, 2016
If the news clip is correct, how does a lottery change the distribution of income? Draw two Lorenz curves to illustrate your
answer.
CID
Lotteries result in the distribution of income
OA. becoming more unequal
OB. becoming more equal
OC. remaining unchanged
Draw the Lorenz curve in a country that does not have lotteries. Label it Before.
Draw the Lorenz curve for the country after the introduction of lotteries. Label it After.
>>> To reposition the label click on the cross by the label box and drag it.
Cumulative percentage of income
100-
80-
60-
0
20
40
60
80
100
Cumulative percentage of households
>>> Draw only the objects specified in the question.
40-
20-

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.