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Income Distribution

Income is most often earned through wages and is what an individual receives for their hours of labour or investments. The government usually taxes an employee’s income and the government, allocated by the federal budget, uses the revenue of income taxes. If a family’s level of income is less than the average income level, necessary goods and services can become too expensive and this creates the possibility for the family to fall into poverty.

Income can be thought of as GDP per capita and is often an indicator of economic growth and development. Typically as the GDP per capita a economy is likely developing. But, just looking at GDP per capita ignores the effect of income distribution. The GDP per capita, for example, can grow from only an increase in incomes of the wealthiest 0.5% of the population and the poorest can even be getting poorer. This is not a situation of good economic development even though GDP per capita is rising. 

Income distribution measures the amount of income earned by different divisions within the population. The Lorenz curve models how income is distributed throughout a community and measures income inequality. The Gini coefficient measures inequality as a statistical measure among frequency distributions. These two measures provide both a graphic and a quantitative representation of income distribution respectively. 

Income inequality is a prevalent issue in the United States and many other countries, which is why income distribution an important topic in macroeconomics.

Monetary Policy for the Federal Reserve

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Tariffs: Pros and Cons

Please help me with at least 1400 words on the pros and cons of tariffs. Please reference at least 3 academic resources

The Paradox of Thrift is a Fallacy

I have a question regarding the interesting paradox called the "Paradox of Thrift", which arises when households become concerned about their future and attempt to increase their savings. As a consequence of such action the overall economy will suffer as a result of these consumers removing money from circulation. Explain. Do y

GNP vs GDP

What is the difference between GDP and GNP? Which is a more accurate measure of local income and why? I understand the difference between GDP and GNP however, I am unsure on how to answer the second question as to which one is more accurate with regards to local income and why. Thank you for your help!

Aggregate Demand and Supply Curves

I am trying to understand shifts in the aggregate supply and demand curves. What happens to aggregate demand and aggregate supply when a tax is raised or imposed? Which direction to they shift and why?

AutoEdge Solution - Economic Market Structures

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Components of the GDP

There are probably a thousand macro economic indicators, some measure the overall national economy, some are more limited in scope. The three most often quoted and publicized are the Gross Domestic Production Index (GDP), the Consumer Price Inflation Index (CPI) and the Unemployment Index. Please complete the short answer questi

Production Possibilities Curve, Economic System

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ACME Corporation consists of 250 grocery stores throughout the Midwest. At the beginning of 2008 its statement of net worth showed the following information: Common Stock ($1 par) $400,000; Capital paid in excess of par $1,400,000 and retained earnings $500,000. During the year, net income equaled $160,000. Management was undeci

The Longevity of Businesses

Task: Fiskars, since 1649...The manufacturer of these products (and many others) has been in business for over 350 years.Your task is to find two more businesses which have also been around for at least over 100 years. Your research should focus on the other companies longevity and the economic reasons for this phenomena. Plea

Price Discriminate

Find 2 companies in the geographical location you live in and find out if they "price discriminate." Why do these 2 companies "price discriminate?" In what ways do they "price discriminate?" Have these companies faced any negative feedback or press in terms of their pricing behavior? How is Chapter 10's treatment of price di

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Suppose the corporate income taxes were eliminated and corporate income was allocated to shareholders on a pro rata basis according to their proportion of outstanding stock. How would such a change in tax policy affect the excess burden and incidence of the tax, assuming that all forms of investment income are included in a comp

Water use

Consider two methods for achieving less water use in a community. The first method includes trying to convince people to apply water conservation measures and to use less water at current prices. The second method involves driving up the price of water. Discuss the merits of both approaches. Which one do you think would be more

Order of income distribution in Acaville

A total of 5,000 people live in Acaville. There are 1,000 high school students, 1,000 undergraduate students, 1,000 graduate students, 1,000 economics professors, and 1,000 retired economists. Suppose that the total annual income in the economy is $100 million: each high school student makes $2,500 annually; each undergraduate m

Meaning of the Gini coefficient

Please help answer the following problems. Suppose France has a Gini coefficient of 0.4, and Germany has a Gini coefficient of 0.3. Which of the following conclusions are we able to make with this information? a) The ratio of the total income of the lowest quintile of the income distribution to the total income of the hig

Graphing Relationship Between Income and Saving

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Is Social Security necessary?

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economics of population growth

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Poverty concepts including P2, headcount ratio, and poverty gap

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Lorenz Curve

Consider a 12-person stylized dual economy with the following income distribution: (1,1,1,1,1,1,1,1,1,4,4,4,4) 1- Graph the Lorenz curve. 2- Calculate The Gini coefficient 3-Now suppose the incomes of two members increase from 1to 4. Graph the Lorenz curve (you may use your graph in part1, distinguish which curve applies h

Using the Substitution and Income Effects

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GDP

Explain the relationship between the marginal propensity to consume and the marginal propensity to save. How do these two components affect GDP?

Why should you first reduce debt before investing?

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Intermediate vs. Final Goods

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Common Size Statement Value

18. A firm has sales of $1,500, net income of $100, total assets of $1,000, and total equity of $700. Interest expense is $50. What is the common-size statement value of the interest expense? A. 3.3% B. 5.0% C. 7.1% D. 16.7% E. 50.0%.