oclety percent of population iS fo groups. group percent of the population is poor. Consider two scenarios. group is poor. Suppose Scenario A: The rich have $60,000 each, while the poor have $2,000 each. Scenario B: The rich have $7,500 each, while the poor have $750 each. If you only care about average income and not about equity, you would prefer , which has an average income of S. (Enter your respo dollar.) Now suppose that you only care about equity or inequality. In this case, you would prefer which has a rich-to-poor ratio of. (Round your response to one decimal place.) Finally, suppose you only care about living standards. In this case, you would prefer because it has lower poverty.
oclety percent of population iS fo groups. group percent of the population is poor. Consider two scenarios. group is poor. Suppose Scenario A: The rich have $60,000 each, while the poor have $2,000 each. Scenario B: The rich have $7,500 each, while the poor have $750 each. If you only care about average income and not about equity, you would prefer , which has an average income of S. (Enter your respo dollar.) Now suppose that you only care about equity or inequality. In this case, you would prefer which has a rich-to-poor ratio of. (Round your response to one decimal place.) Finally, suppose you only care about living standards. In this case, you would prefer because it has lower poverty.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Assume a society consists of two economic groups: one group is rich and the other group is poor. Suppose that 50 percent of the population is rich while the other 50
percent of the population is poor. Consider two scenarios.
Scenario A: The rich have $60,000 each, while the poor have $2,000 each.
Scenario B: The rich have $7,500 each, while the poor have $750 each.
If you only care about average income and not about equity, you would prefer
V. which has an average income of S
(Enter your response to the nearest
dollar.)
Now suppose that you only care about equity or inequality.
In this case, you would prefer
which has a rich-to-poor ratio of (Round your response to one decimal place.)
Finally, suppose you only care about living standards.
In this case, you would prefer
because it has lower poverty.
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