Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

2. The Supplemental Poverty Measure (SPM), by the US Census Bureau, extends the oicial poverty measure by taking in account many of the government programs

image text in transcribedimage text in transcribed
image text in transcribedimage text in transcribed
2. The Supplemental Poverty Measure (SPM), by the US Census Bureau, extends the oicial poverty measure by taking in account many of the government programs designed to assist low-income families. Here we consider households in Massachusetts with minimal income of $25,000 and aim to describe income distribution in the state. To this end, we assume that income follows a Pareto distribution and t a regression on the following predictors: numadults is the number of adults in the household; tenure is household occupancy tenure, a factor with two levels, \"own\" and \"rent\"; and race has four levels, \"white", \"black\(c) How would you rank incomes with respect to race? Do incomes differ significantly among races? Explain. (d) The Pareto "80 20" principle stipulates that 80% of the income belongs to the top 20% of the households. This principle depends, in fact, on the index; in this case, it can be shown that a = 1.16. Test if the Pareto principle applies to rented households with two asian occupants. For simplicity, assume that the parameter estimates are not correlated. Clearly state the test statistic, its distribution under the null, and your assumptions. What is your conclusion at 5% significance

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Sacred Mathematics Japanese Temple Geometry

Authors: Fukagawa Hidetoshi, Tony Rothman, Freeman Dyson

1st Edition

1400829712, 9781400829712

More Books

Students also viewed these Mathematics questions