The following table summarizes the income distribution for the town of Perkopia, which has a population of 10,000 people. Every individual within an income group earns the same income, and the total annual income in the economy is $500,000,000. Suppose that in 2010, the poverty income threshold, or poverty line, is set at an annual income of $42,350 for an individual. Year 2006 2010 2016 2020 Lowest Quintile 3.0 3.4 3.8 5.0 Quintile Lowest Second Middle Fourth Highest The data in the table suggest that there was Second Quintile 8.6 9.4 9.7 11.0 Share of Total Income in Perkopia (Percent) Middle Quintile Fourth Quintile 14.0 14.6 15.2 15.5 Share of Income in 2010 (Percent) 3.4 9.4 14.6 22.4 50.2 21.9 22.4 22.9 25.0 Total Income (Dollars) Complete the following table to help you determine the poverty line in Perkopia in 2010. To do this, begin by determining the total income of all individuals in each quintile, using the fact that total annual income in the economy is $500,000,000. Next, determine the income of an individual in each quintile by dividing the total income of that quintile by the number of people in that quintile. (Hint: Recall that Perkopia has a population of 10,000 people.) Finally, determine whether the individual income for each quintile falls below the poverty income threshold, or poverty line, of $42,350. Highest Quintile income inequality from 2006 to 2020. 52.5 50.2 48.4 43.5 Individual Income (Dollars) Below Poverty Line? □□□□□□□□□□□
The following table summarizes the income distribution for the town of Perkopia, which has a population of 10,000 people. Every individual within an income group earns the same income, and the total annual income in the economy is $500,000,000. Suppose that in 2010, the poverty income threshold, or poverty line, is set at an annual income of $42,350 for an individual. Year 2006 2010 2016 2020 Lowest Quintile 3.0 3.4 3.8 5.0 Quintile Lowest Second Middle Fourth Highest The data in the table suggest that there was Second Quintile 8.6 9.4 9.7 11.0 Share of Total Income in Perkopia (Percent) Middle Quintile Fourth Quintile 14.0 14.6 15.2 15.5 Share of Income in 2010 (Percent) 3.4 9.4 14.6 22.4 50.2 21.9 22.4 22.9 25.0 Total Income (Dollars) Complete the following table to help you determine the poverty line in Perkopia in 2010. To do this, begin by determining the total income of all individuals in each quintile, using the fact that total annual income in the economy is $500,000,000. Next, determine the income of an individual in each quintile by dividing the total income of that quintile by the number of people in that quintile. (Hint: Recall that Perkopia has a population of 10,000 people.) Finally, determine whether the individual income for each quintile falls below the poverty income threshold, or poverty line, of $42,350. Highest Quintile income inequality from 2006 to 2020. 52.5 50.2 48.4 43.5 Individual Income (Dollars) Below Poverty Line? □□□□□□□□□□□
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 6SCQ: A group 0f 10 people have the following annual incomes:...
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