>> The size of the pie was 100 dollars.  Each person had 10 dollars income.
Therefore the average is 10 dollars a person.  The size of the pie increases
to 102 dollars, population remains the same, the average becomes 10.2
dollars, BUT 9 people have 1 dollar income and one person has 93 dollars.

>1. Where did the $10 go that they each earned the first year and why
did it go there?

They probably spent the money on stuff they need: food, housing, etc etc

>2. Why did the incomes of the nine drop to $1?

"free market principles"?  Whatever they call it.

>Are you saying that income is a zero-sum system?

I don't know what that is.

>3. It looks like the nine each gave $9 to the one.  Why did they do
that?

Well, they didn't give it to that one.  You know how the "free market"
works.  It may start off fairly even, but then it has to become less and
less even.  One gets ahead of the others and then uses that advantage to
continue to increases his/her size of the pie at others expense.

>4. Even if they did each give $9 to the one, they should have each had
$1 left.  Then the $1 you say they earned in the second year would
have taken them to $2 each.

Income.  Not net worth.

>I think I don't understand the example.

It isn't important.  I was just trying to make a point about averages.

Milutin

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