Question: 9. Consider the following graph that you will use to select an inequality allocation in your society. Income of rich Maximum feasible income of

9. Consider the following graph that you will use to select an inequality allocation in your society. Income of rich Maximum feasible income of the rich Income of both classes with complete equality Minimum feasible income of the poor Feasible frontier (Slope: MRT) 45 Feasible set E Maximum average income Slope =-1 Highest feasible indifference curve of an inequality-averse citizen Slope: MRS Income of poor Rawls' ideal Maximum feasible income of the poor If you were EQUALITY averse, which point would you choose? a) Point A b) Point B c) Point R d) Point F e) Point D Rich' and 'poor' equal along this line 10. Which of the following statements are true? a) Capital income is vastly more unequal than labour market income in South Africa. b) Labour market income is vastly more unequal than capital income in South Africa. c) Income from capital in South Africa has grown despite low economic growth. d) A and C only. e) B and C only.
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