Question
Officials in Nerfenland are concerned about the current level of income inequality in their country, where the highest quintile of families currently earn 60% of
Officials in Nerfenland are concerned about the current level of income inequality in their country, where the highest quintile of families currently earn 60% of the country's income. The central government has income information on its citizenry, and they want you to help them interpret the data from a 10-year period.
The table below gives data on how families have moved between income quintiles between the years shown.
Fill in the missing values in the distribution table for families in Nerfenland; then use the information in the table to answer the following questions.
Income Distribution in 1995 | Income Distribution in 2005 | ||||
---|---|---|---|---|---|
(Percent) | |||||
Highest Quintile | Second Quintile | Third Quintile | Fourth Quintile | Lowest Quintile | |
Highest Quintile | 30 | 20 | 18 | 17 | 15 |
Second Quintile | 22 | 30 |
| 11 | 15 |
Third Quintile |
| 15 | 32 | 17 | 19 |
Fourth Quintile | 16 |
| 20 | 15 | 21 |
Lowest Quintile | 15 | 7 | 8 |
| 30 |
Looking at families in the lowest quintile of income in 1995 (bottom row), you can report that
of families in the lowest quintile moved into a higher quintile of income distribution by 2005.
Now look at the percentage of families in each quintile that remained in the same quintile between 1995 and 2005. In each quintile, a of families moved to a different quintile. This implies that Nerfenland has economic mobility.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started