Assume that the poverty line is given as $2 a day. Use the information in Table 1 below to answer the following questions.

Assume that the poverty line is given as $2 a day. Use the information in Table 1 below to answer the following questions.

Table 1: Income Distribution in three countries

Individual	Country A	Country B	Country C
1	1.90	1.90	4.75
2	3.50	1.10	6.50
3	1.50	2.15	1.20
4	1.90	11.0	4.20
5	4.00	1.20	0.10
6	1.80	1.65	0.20
7	3.20	0.40	2.20
8	0.80	3.89	2.50
9	2.01	1.50	2.50
10	1.90	1.10	1.00
11	1.45	1.80	4.00
12	1.50	2.95	0.40

 

i. Calculate the headcount Index (Q) for Country A, Country B and Country C.

ii. Assume you are a policymaker and the headcount index (Q) is the only measure of poverty available to you. Based on your calculations in (i), will your policies to combat poverty in country A differ from that of country B?

iii. Calculate the Total Poverty Gap (TPG) for Country A, Country B, and Country C?

iv.  Suppose that you now have new information regarding the TPG for the three countries as computed in (iii). With this new information at hand, as policymaker will your policy stance in (Q.2) change? Briefly explain your answer.

v. Calculate the following for each country
(a) Average poverty Gap
(b) Normalized poverty Gap
(c) Average income shortfall