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Consider an economy consisting of 5 people, all of whom initially work in a traditional agriculture sector earning $500 a year. Suppose the modern

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Consider an economy consisting of 5 people, all of whom initially work in a traditional agriculture sector earning $500 a year. Suppose the modern sector starts to develop and hires a new worker each year, paying $2000 a year. So in year 0 there are no modern sector workers, in year 1 there is 1 modern sector worker and in year 5 all of them work in the modern sector. (a) Calculate the GDP per person for each year from 0 to 5. (b) Calculate the Gini coefficient for each year from 0 to 5.

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To calculate the GDP per person for each year from 0 to 5 we need to determine the total GDP and divide it by the number of people in the economy In y... blur-text-image

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