Question 2: A region has 28 people and three income groups A,B,C. Group A has population 12, group B has population 12 and group C has population 4. Each person in group A has income $3, each in group B has income $8 and each in group C has income $16. The poverty line is p = 10 (anyone with income below $10 is considered poor). There is a budget of $48 to be given among groups whose income falls below p = 10. Each person within the same group must receive the same amount. Assume that every dollar received by an individual is invested and this raises the income of the individual by a dollar. Consider the following policies:

Policy 1: allocate $24 to group A, $24 to group B Policy 2: allocate $36 to group A, $12 to group B Policy 3: allocate $12 to group A, $36 to group B Showing all steps of your work, find HCR, PGR, IGR under each of the three policies and determine

(i) which policy/policies give the lowest HCR,

(ii) which policy/policies give the lowest PGR

(iii) which policy/policies give the lowest IGR.