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Economics

a. In the presence of an underground economy likely to result in a Gini coefficient that overstates or understates poverty?

b. Consider a simple economy where 90 percent of citizens report an annual income of $10,000 while the remaining 10 percent report an annual income of $110,000. What is the Gini coefficient now?

c. suppose the poorest 90 percent of citizens actually have an income of $15,000 because each receives $5,000 of unreported income from the underground economy. what is the Gini coefficient now?

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M9744429

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