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Consider two countries A and B. Suppose the household shares of aggregate income by quintile in each country are given by the following table: Quintile
Consider two countries A and B. Suppose the household shares of aggregate income by quintile in each country are given by the following table: Quintile Share of Income Cumulative Share of Income Country A First (bottom income 0.03 group) Second 0.05 Third 0.12 Fourth 0.20 Fifth (top income group) 0.60 Country B First (bottom income 0.05 group) Second 0.15 Third 0.18 Fourth 0.22 Fifth (top income group) 0.408. Calculate the Cumulative Share of Income for each country, and fill the empty column in the table. 9. Draw the Lorenz curve for each country. Clearly label the axes. 10. What is a Gini coefficient? Which country do you think will have a higher Gini Coefficient? (Note: no need for mathematical calculation, just explanation)
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