Consider an economy with 5 citizens who have the following incomes: 5, 3, 10, 0, 5.

**(a) Calculate the Kuznets ratio.**

**© Draw the country’s Lorenz curve.**

**(e) Suppose (again asuming the income distribution described at the beginning of this question) that**

everyone’s income doubles. Draw the new Lorenz curve. Did inequality go up or down?

everyone’s income doubles. Draw the new Lorenz curve. Did inequality go up or down?

For (a), I got that the Kuznets ratio is 0/10 or just 0. I was wondering if someone could confirm this.

For ©, I had 0/23 income for the bottom 20% of the population, 3/23 for the bottom 40%, and here's where it got tricky. Since there were two 5s, I wasn't sure what to do, but I added another 5 to get 8/23 for the bottom 60%, and added 5 again to get 13/23 for the bottom 80%. Was that correct?

For (e), I got the same curve that I did for ©, so graphically, inequality remains the same. However, intuitively, inequality would have increased, so I'm wondering if inequality actually goes up.

Thanks!