Can someone please explain it to me ASAP?!!!!!! I need help for part e. I'm stuck on this problem. This is Area between the Curves.
A Lorenz curve is given by y = L(x), where 0 s x s 1 represents the lowest fraction of the population of a society in terms of wealth and 0 sys'l represents the fraction of the total wealth that is owned by that fraction of the society. Use this information to complete parts a through 9. [x Click the icon to View an example of a Lorenz curve. a. A Lorenz curve y = L(x) is accompanied by the line y = x, called the line of perfect equality. Explain why this line is given this name. Choose the correct answer below. - ,. A. The lowest 50% of households own 100% of the wealth. B. The lowest p% of households owns exactly (1 p)% of the wealth for 0 5 p5 100. -'9"C. The lowest p% of households owns exactly p% of the wealth for 0 5 p5 100. j - D. The lowest 50% of households own 60% of the wealth. b. Explain why a Lorenz curve satises the conditions L(O) = 0. L(1) = 1, and L'(x)a 0 on [0,1]. Choose the correct answer below. : - A. The function must be increasing and concave down because the poorest p% has to own more than p% of the wealth. -_9'B. The function must be increasing and concave up because the poorest p% cannot own more than p% of the wealth. '7 C. The function must be decreasing and concave up because the poorest p% cannot own more than p% of the wealth. 7 D. The function must be decreasing and concave down because the poorest p% cannot own more than p% of the wealth. 1:. Graph the Lorenz curves L(x) = x\" conesoondino to D = 1.2. 1.4. 2. 3. 4. Which value of D corresponds to the most equitable distribution of wealth (closest to the line of perfect equality)? Which value of o Example of Lorenze Curve y LO Line of perfect equality 0.8 of households 0.6 control 0.6 of the wealth Fraction of total income A Lorenz curve, y = L(x) 0.5 of households control 0.2 of the wealth 0.5 0.8 1.0 X Fraction of householdsc. Graph the Lorenz curves L(x) = x corresponding to p = 1.1, 1.6, 2, 3, 4. Which value of p corresponds to the most equitable distribution of wealth (closest to the line of perfect equality)? Which value of p corresponds to the least equitable distribution of wealth? Explain. O A. p= 4 is most equitable. p = 1.1 is least equitable. y = x more closely resembles the line of perfect equality, whereas the curve y = - x least resembles the line. O B. p= 4 is most equitable. p = 1.1 is least equitable. y = x# more closely resembles the line of perfect equality, whereas the curve y = x1.1 least resembles the line. C. p= 1.1 is most equitable. p = 4 is least equitable. y = x* more closely resembles the line of perfect equality, whereas y = x1.1 least resembles the line. D. p= 1.1 is most equitable. p = 4 is least equitable. y = x1.1 more closely resembles the line of perfect equality, whereas the curve y = x# least resembles the line.e. Compute the Gini index for the cases L(x) = xP and p = 1.1, 1.6, 2, 3, 4. The Gini index for p = 1.1 is
