Compare the distributions of income before and after tax

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Reference no: EM131798816

Income distribution

In an effort to make the distribution of income more nearly equal, the government of a country passes a tax law that changes the Lorenz curve from y = 0.99x^2.1 for one year to y = 0.32x² + 0.68x for the next year.

Find the Gini coefficient of income for both years and compare the distributions of income before and after the tax law was passed. Interpret the result.

Reference no: EM131798816

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