Using the figure below, calculate the gain from redistributing $25,000 from those earning $100,000 to those earning $50,000. Why do you think that this gain in well-being is smaller than the redistribution in the example in the chapter, which is redistributed from someone earning $200,000 to someone earning $20,000? What are some potential problems with this redistribution plan?

Using the figure below, calculate the gain from redistributing $25,000 from those earning $100,000 to those earning $50,000. Why do you think that this gain in well-being is smaller than the redistribution in the example in the chapter, which is redistributed from someone earning $200,000 to someone earning $20,000? What are some potential problems with this redistribution plan?

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter12: Income Distribution, Poverty, And Discrimination

Section: Chapter Questions

Problem 1SQP

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