Recall the Application about why international trade may reduce measured inequality in the United States to answer the following question(s). While it is conventional wisdom now that inequality in the United States has increased in the last several decades, until recently no one has taken a careful look at the actual living standards of different income groups, taking into account the goods they purchase. Two economists from the University of Chicago, Christian Broda and John Romalis, investigated the living standards of low-income groups and high-income groups based on the goods these groups purchase.
-According to this Application, the poor consume ________ ratio of nondurable goods to services ________.

Question

Quizplus · Accepted Answer

The poor consume a higher ratio of nondurable goods to services than the rich, as nondurable goods often cost less and are more essential, making up a larger proportion of the consumption basket for lower-income groups.

Recall the Application About Why International Trade May Reduce Measured