There are 100 households in the economy of Equalor. Initially, 99 of them have an income of \(\$ 10,000\) each, and one household has an income of $\$ 1,010,000$. a. What is the median income in this economy? What is the mean income? Through its poverty programs, the government of Equalor now redistributes income: it takes \(\$ 990,000\) away from the richest household and distributes it equally among the remaining 99 households. b. What is the median income in this economy now? What is the mean income? Has the median income changed? Has the mean income changed? Which indicator (mean or median household income) is a better indicator of the typical Equalorian household's income? Explain.

#tag_title# Initial Median and Mean Income Calculation #tag_content# Median Income \(= \frac{\$10,000 + \$10,000}{2} = \$10,000\) Mean Income \(= \frac{99(\$ 10,000) + (\$ 1,010,000)}{100} = \frac{\$ 990,000 + (\$ 1,010,000)}{100} = \frac{\$ 2,000,000}{100} = \$20,000\) The initial median household income is \(\$10,000\), and the initial mean household income is \(\$20,000\). #Part b# #tag_title# New Median Income #tag_content# After the government has redistributed income, each household will have an income of \(\$20,000\). Since all incomes are now the same, we can easily find the new median income: New Median Income = \$20,000 #tag_title# New Mean Income #tag_content# Since each household now has an income of \(\$20,000\), the new mean income does not change: New Mean Income = \$20,000 #Part c# #tag_title# Best Indicator for a Typical Equalorian Household's Income #tag_content# After the redistribution, both the median and mean income are the same at \(\$20,000\). This means that the typical Equalorian household's income is best represented by both the median and mean income, which is \(\$20,000\).