Calculating the Gini Coefficient from a Lender's Income Share
Once the lender's income share (s) has been determined, it can be used to find the Gini coefficient for the one-lender, five-borrower economy. For instance, if the lender's share is calculated to be , this value is substituted into the model's simplified Gini formula, . The calculation yields a Gini coefficient of g = (6(2/3) - 1)/5 = (4 - 1)/5 = 3/5 = 0.6.
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Introduction to Microeconomics Course
CORE Econ
Ch.9 Lenders and borrowers and differences in wealth - The Economy 2.0 Microeconomics @ CORE Econ
The Economy 2.0 Microeconomics @ CORE Econ
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Calculating the Gini Coefficient from a Lender's Income Share
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