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1. (a) (8 points) Draw Lorenz curves for 2 income distributions in two countries. Can you say which distribution is more unequal based on the

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1. (a) (8 points) Draw Lorenz curves for 2 income distributions in two countries. Can you say which distribution is more unequal based on the figures? Income Distribution in Springfield: ($10, $15, $20, $40; $90); (10, 40, 40, 50, 50) Income Distribution in Avataria: ($10, $15, $20, $25; $35); (5, 15, 15, 10, 5) Note that for each country the first set of numbers represents the various incomes; whereas the second set of numbers represents the number of people earning each of these incomes. For example, in Springfield there are 10 people with the individual income of $10, 40 people with the individual income of $15, 40 people with the individual income of $20, and so on. (b) (2 points) Assume that Mr. Burns with his income of $1,500,000 has moved into Springfield. How does this change affect Lorenz curve and Gini coefficient in Springfield? (You do NOT need to draw or calculate anything, just explain)

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