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5) (10 points) Consider an economy with 1 million people and the following income distribution. 400,000 people earn $30,000 per year and 600,000 people earn

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5) (10 points) Consider an economy with 1 million people and the following income distribution. 400,000 people earn $30,000 per year and 600,000 people earn $80,000 per year. (You can simplify the numbers in the question to make the calculations easier) a) (4 points) What is the Gini coefficient associated with this income distribution? b) (5 points) Suppose 600,000 people with an income of $80,000 per year pay 12.5 percent income tax and the other group does not pay any tax. Tax money is equally distributed to low-income group. What is the Gini coefficient associated with this redistribution plan? c) (1 point) What does the difference between two Gini coefficients tell us about the tax policy? Does the Gini coefficient change in the way that you expect

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