Use the data in the spreadsheet and what you have learned so far in class to answer the following questions about income in rural Mexico excluding government transfers.

1. What is the average per-capita income in U.S. dollars for Mexico's rural households in 2007 excluding government transfers using the nominal exchange rate then adjusting for PPP?

2. We know Mexico is an "upper-middle" income country. If rural Mexico were its own country, would it be an upper-middle country, too? Which exchange rate?the nominal one or PPP adjusted?do you use to answer this question, and why? 2 Next, we want to determine the level of inequality and the level of poverty in rural Mexico. creating a new variable (column) called rankpcy. This will be the household's income rank in terms of per-capita total income in U.S. dollars, PPP adjusted, excluding government transfers. The household with the least amount of per capita income should have a value of rankpcy equal to

1. The household with the second least amount of per capita income should have a value of rankpcy equal to 2, and so on. The richest household should have a value of rankpcy equal to 927. Then, using rankpcy create new variable called F(pop), which will be the cumulative distribution of the population (i.e., the ratio of the household value of rankpcy compared with the total number of households). The way to check if you have done this correctly is that the richest household should have a value of F(pop) equal to