Consider the Following Distribution of Income in a 12-Person Economy

question 40

Essay

Consider the following distribution of income in a 12-person economy, with the modern urban ?wage ₌ 10, the traditional rural income ₌ 2, and the informal urban wage ₌ 4: (2, 2, 2, 2, 4, 4, 4, 4, 10, 10, 10, 10).
a.Suppose rural incomes are raised to 3, other things equal. Show the change using the Lorenz curve. How would this type of growth be characterized? (It is suggested that you use the Fields growth decomposition in answering. This shows traditional sector enrichment growth.) b.Calculate the Ahluwalia-Chenery Welfare Index for terciles (3 fractiles) under GNP weights and equal weights. Which index is higher and why?

Recognize the breadth of motivation study within psychology, including its theoretical and practical applications.

Appreciate the cognitive aspects of understanding human behavior and motivation, especially in making inferences about others' actions.

Examine motivation from a physiological perspective, including the view of motive states and the significance of genetic transmission across generations.

Understand various revenue models and their applicability to different business scenarios.

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Definitions:

Variable Costing

An accounting method that only includes variable costs—costs that vary with production levels—when calculating the cost of producing a good or service.

Net Operating Income

The profit generated from a company’s everyday business operations, calculated by subtracting operating expenses from revenue.

Units Produced

The total number of units created by a production process over a specific period of time.

Break Even

The point at which total revenues equal total costs, resulting in neither profit nor loss.