Question

We wish to compare the relative standard of living for two government officials. One lives in an Italian village with a mean income of 20,500 euros and standard deviation of 4,800 euros. The other lives in a U.S. town, with a mean income of $52,000 and standard deviation of $22,750. Their respective incomes are 19,000 euros and $48,000 respectively. Who is relatively better off (compared to their locale)?

Answer 1

Person from Italian village with income = 19000

z-score

and

Person from U.S. town with income = 48000

z-score

Since z-score for person from U.S. town with income = 48000 > z-score for person from Italian village with income = 19000,

so person from U.S. town with income = 48000 is better.