Consider the following table with individuals in Kenya and their incomes: Indivi
ID: 1142559 • Letter: C
Question
Consider the following table with individuals in Kenya and their incomes:
Individual Income
1 $122
2 $133
3 $109
4 $600
5 $1075
6 $500
7 $525
8 $95
9 $110
10 $111
A. Assume that the poverty line is $160 in Kenya. The total poverty gap (i.e.,FGT where = 1) for Kenya is:
a. 17.5%
b. 0.175%
c. 1.22%
d. Cannot be computed based on information provided.
B. Assume that the poverty line is $160 in Kenya. The severity of poverty (i.e.,FGT where = 2) for Kenya is:
a. 0.0543%
b. 0.543%
c. 5.43%
d. Cannot be computed based on information provided.
C. Assume that the poverty line is $160 in Kenya. The headcount index or ratio is:
a. .60
b. .65
c. .30
d. .70
D. Assume that the poverty line is $160 in Kenya. The total amount needed to get all persons in poverty up to the poverty line is:
a. $300
b. $1780
c. $280
d. $78,400
Explanation / Answer
1. Gap from the poverty line Dividing by the poverty line Squaring
Poverty line =160
Summation 1.725
Dividing by the total number 1.725/10 0.1725
a) 17.5
B)
Summation after squaring 0.531
Divide by 10 0.0531
c) 5.43
C. 6/10
a) 60 percent
D.
c) 280
adding from the poverty gap, the number is 276; approximately 280