Question 1:

The table below shows the share of income received by each fifth of income earners, from lowest to highest, in three hypothetical countries. 1 2 3 4 5 lowest) (highest) Country 1 9 14 18 23 36 Country 2 7 11 17 24 41 Country 3 5 10 15 25 45 a. Calculate the cumulative distribution of income among the five groups of income earners in each country. Enter your responses below rounded to a whole number. 1 2 3 4 5 ( lowest) (highest) Country 1 Country 2 Country 3 b. Draw a graph showing the three countries' Lorenz curves. Plot 6 points for each curve, including the origin point (0, 0), for a total of 18 points plotted below. To manually enter plotting coordinates click on a line segment between 2 points then click on the widget icon to bring up the curve properties box. Lorenz Curve For three countriesThe table below shows hypothetical market demand and supply schedules for cranberries. Price ($ Per kg) 3.99 2.59 2.99 1.59 1.99 a. Draw a graph showing the demand and supply curves, D and 8. Plot only the endpoints to draw the demand curve [D] and the supply curve (8}. (D Market Supply and Demand for Cranberries 3.5 Tools 1.5 - Price (S per kilogram) 1.0 - 0.5 - b. Before government intervention equilibrium price is $ and equilibrium quantity is million kilograms per year. Enter your responses for prices rounded to 2 decimal places. c. The initial consumer surplus in this market is $ million and the initial producer surplus is $ million. d. Certain producers in this market are given exclusive rights to sell cranberries and they choose to restrict quantity supplied to 3 million kilograms per year. The new equilibrium price becomes $ and the new equilibrium quantity becomes million kilograms. e. The transfer of consumer surplus to producer surplus resulting from this policy is $ million and the deadweight loss is $ million. f. Due to this policy consumers are |(Click to select) | and producers still operating in the market are (Click to select) v g. The deadweight loss resulting from the output restriction is a dollar estimate of how much O consumers are made worse off. O producers who are still in the market are made worse off. O producers who have lost the right to operate in this market are made worse off. O society as a whole is made worse off.100 Tools n n 80 Country 1 Country 2 60 n Country 3 Cumulative Share of Income (%) 40 (53, 38) 20 20 40 60 80 100 Households (%) C. (Click to select) | has the most equal distribution of income, (Click to select) | has the least equal distribution, and (Click to select) | is in the middle