1. Is a person's money income a good approximation for their total utility? Explain. 2. Society...
1. Is a person's money income a good approximation for their total utility? Explain.
2. Society consists of fifteen single individuals. Their incomes are as follows:
| $100,000 | $75,000 | $25,000 | $35,000 | $150,000 |
| $80,000 | $15,000 | $45,000 | $85,000 | $90,000 |
| $110,000 | $135,000 | $95,000 | $70,000 | $60,000 |
Use the data to construct a table showing the percentage of total income received by each quintile. Then compute the cumulative distribution and use it to construct a Lorenz curve and Gini coefficient.
Homework Answers
As per HOMEWORKLIB RULES first question is answered
Kindly ask rest of the questions in a separate post
1.
No, a person's money income is not a good approximation of their total utility. This is because as it is widely said, money cannot buy happiness. This is true. Money can help people buy materialistic things but not everybody derives the same utility from the same things. Some people can be happy with even a two time simple meal while some are not satisfied even after a 5 time meal in a five star. Utility is a subjective term and cannot be applied to everyone in the same manner.
Thus, taking money income as an approximation of utility would be an incorrect thing to do. Utility covers many more areas under it, apart from money.
Add Answer to:
1. Is a person's money income a good approximation for their
total utility? Explain.
2. Society...
"Society consists of fifteen single individuals. Their incomes are as follows. Use the data to construct...
"Society consists of fifteen single individuals. Their incomes are as follows. Use the data to construct a table showing the percentage of total income received by each quintile. Then compute the cumulative distribution and use it to construct a Lorenz curve and Gini coefficient using the method described in Chapter 1 Appendix A from the textbook The Economics of Inequality, Discrimination, Poverty, and Mobility. $100,00 $75.000 $25,000 $35,000 $150,000 $80,000 $15,000 $45,000 $85,000 $90,000 $110,000 $135,000 $95,000 $70,000 $60,000
Determine the missing ammounts in each of the following independent cases. Determine the missing amounts in...
Determine the missing ammounts in each of the following
independent cases.
Determine the missing amounts in each of the following independent cases. Case A Case B $ 20,000 Case C $ 15,000 30,000 90,000 100,000 70,000 85,000 95,000 100,000 250,000 520,000 35,000 125,000 160,000 340,000 345,000 20,000 35,000 5,000 350,000 Beginning inventory, raw material Ending inventory, raw material Purchases of raw material Direct material Direct labor Manufacturing overhead Total manufacturing costs Beginning inventory, work in process Ending inventory, work in...
Case B $ 20,000 Case A $ 10,000 90,000 100,000 70,000 Case C $ 15,000 30,000...
Case B $ 20,000 Case A $ 10,000 90,000 100,000 70,000 Case C $ 15,000 30,000 85,000 95,000 100,000 Beginning inventory, raw material Ending inventory, raw material Purchases of raw material Direct material Direct labor Manufacturing overhead Total manufacturing costs Beginning inventory, work in process Ending inventory, work in process Cost of goods manufactured Beginning inventory, finished goods Cost of goods available for sale Ending inventory, finished goods Cost of goods sold 125,000 160,000 340,000 250,000 520,000 35,000 345,000 20,000...
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please ignore part1 ,need answers for part 2
Q5. Inequality Part I: Lorenz-Curve and Gini Coefficient Consider the following (very roughly measured) distribution of income in the economy Share of Households Cumulative Share of Income 0 Thus, the distribution function says that the lower half of the households carns one fourth of the total income in the society 1. Draw the Lorenz-curve for the economy 2 Calculate the Gini-coefficient. Part II: Redistributing Income Suppose that in an economy composed of...
1. Based on the following data, what is the amount of working capital? Accounts payable....................$32,000 Accounts...
1. Based on the following data, what is the amount of working capital? Accounts payable....................$32,000 Accounts receivable....................64,000 Accrued liabilities....................7,000 Cash.........................................20,000 Intangible assets............................40,000 Inventory...............................................72,000 Long-term investments...............................100,000 Long-term liabilities.....................................75,000 Marketable securities.................................35,000 Notes payable (short-term)........................20,000 Property, plant, and equipment.................625,000 Prepaid expenses.........................................2,000 WHAT IS WORKING CAPITAL? a. $162,000 b. $134,000 c. $193,000 d. $62,000 2. Use the following data to determine the total dollar amount of assets to be classified as current assets. Cash..............................................$60,000 Prepaid insurance..........................40,000 Accounts receivable......................50,000 Inventory.........................................70,000 Land held for investment................80,000 Land................................................95,000...
Determine the missing amounts in each of the following independent cases. Case A Case B Case...
Determine the missing amounts in each of the following independent cases. Case A Case B Case C Beginning inventory, raw material $20,000 $15,000 Ending inventory, raw material 90,000 30,000 Purchases of raw material 100,000 85,000 Direct material 70,000 95,000 Direct labor 100,000 125,000 Manufacturing overhead 250,000 160,000 Total manufacturing costs 520,000 345,000 340,000 Beginning inventory, work in process 35,000 20,000 Ending inventory, work in process 35,000 5,000 Cost of goods manufactured 525,000 350,000 Beginning inventory, finished goods 50,000 40,000 Cost...
only need part b worksheet Illustration #3 Pepper Company, which is a calendar-year-reporting company, purchased 100%...
only need part b worksheet
Illustration #3 Pepper Company, which is a calendar-year-reporting company, purchased 100% of the common stock of Salt Inc. for $325,000 on 12/31/17. On the acquisition date, the following net assets of Salt had fair values different than book value: Cost FMV Inventory 80,000 75,000 Turnover 6 times per year Land 70,000 100,000 Building and equipment 220,000 210,000 10 year life Accumulated depreciation (60,000) Covenant-not-to-complete 40,000 4 year life Bonds payable 150,000 175,000 10 years to...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition date...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition date fair value, $60,000 was allocated to undervalued equipment (with a 10-year remaining life) and $80,000 was attributed to franchises (to be written off over a 20-year period). Since the takeover, Bretton has transferred inventory to its parent as follows: Year 2016 2017 2018 Transfer Cost Price $ 45,000 $ 90,000 48,000 80,000 69,000 92,000 $ Remaining at Year-End 30,000 (at transfer price) 35,000 (at...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition-date fair...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition-date fair value, $60,000 was allocated to undervalued equipment (with a 10-year remaining life) and $80,000 was attributed to franchises (to be written off over a 20-year period). Since the takeover, Bretton has transferred inventory to its parent as follows: Year 2016 2017 2018 Transfer Cost Price $ 45,000 $ 90,000 48,000 80,000 69.000 92.000 $ Remaining at Year-End 30,000 (at transfer price) 35,000 (at transfer...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition-date fair...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition-date fair value, $60,000 was allocated to undervalued equipment (with a 10-year remaining life) and $80,000 was attributed to franchises (to be written off over a 20-year period). Since the takeover, Bretton has transferred inventory to its parent as follows: Year Cost Transfer Price Remaining at Year-End 2016 $ 45,000 $ 90,000 $ 30,000 (at transfer price) 2017 48,000 80,000 35,000 (at transfer price) 2018 69,000...
Determine the missing ammounts in each of the following
independent cases.
Determine the missing amounts in each of the following independent cases. Case A Case B $ 20,000 Case C $ 15,000 30,000 90,000 100,000 70,000 85,000 95,000 100,000 250,000 520,000 35,000 125,000 160,000 340,000 345,000 20,000 35,000 5,000 350,000 Beginning inventory, raw material Ending inventory, raw material Purchases of raw material Direct material Direct labor Manufacturing overhead Total manufacturing costs Beginning inventory, work in process Ending inventory, work in...
Case B $ 20,000 Case A $ 10,000 90,000 100,000 70,000 Case C $ 15,000 30,000 85,000 95,000 100,000 Beginning inventory, raw material Ending inventory, raw material Purchases of raw material Direct material Direct labor Manufacturing overhead Total manufacturing costs Beginning inventory, work in process Ending inventory, work in process Cost of goods manufactured Beginning inventory, finished goods Cost of goods available for sale Ending inventory, finished goods Cost of goods sold 125,000 160,000 340,000 250,000 520,000 35,000 345,000 20,000...
please ignore part1 ,need answers for part 2
Q5. Inequality Part I: Lorenz-Curve and Gini Coefficient Consider the following (very roughly measured) distribution of income in the economy Share of Households Cumulative Share of Income 0 Thus, the distribution function says that the lower half of the households carns one fourth of the total income in the society 1. Draw the Lorenz-curve for the economy 2 Calculate the Gini-coefficient. Part II: Redistributing Income Suppose that in an economy composed of...
only need part b worksheet
Illustration #3 Pepper Company, which is a calendar-year-reporting company, purchased 100% of the common stock of Salt Inc. for $325,000 on 12/31/17. On the acquisition date, the following net assets of Salt had fair values different than book value: Cost FMV Inventory 80,000 75,000 Turnover 6 times per year Land 70,000 100,000 Building and equipment 220,000 210,000 10 year life Accumulated depreciation (60,000) Covenant-not-to-complete 40,000 4 year life Bonds payable 150,000 175,000 10 years to...
Allison Corporation acquired 90 percent of Bretton on January 1, 2016. Of Bretton's total acquisition date fair value, $60,000 was allocated to undervalued equipment (with a 10-year remaining life) and $80,000 was attributed to franchises (to be written off over a 20-year period). Since the takeover, Bretton has transferred inventory to its parent as follows: Year 2016 2017 2018 Transfer Cost Price $ 45,000 $ 90,000 48,000 80,000 69,000 92,000 $ Remaining at Year-End 30,000 (at transfer price) 35,000 (at...
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