rodmah47

rodmah47

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Randal GleasonUniversity of Southern Mindanao

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History8Management1English1Marketing2Science4Information Technology4Geometry1Computer Science1Physics3Finance4Economics10Chemistry2
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Assignment:

Using Yahoo! Finance find the value of beta for your reference company. Write a two page paper discussing the following items:

a. What is the estimated beta coefficient of your company? What does this beta mean in terms of your choice to include this company in your overall portfolio?

b. Given the beta of your company, the present yield to maturity on U.S. government bonds maturing in one year (currently about 4.5% annually) and an assessment that the market risk premium (that is - the difference between the expected rate of return on the 'market portfolio' and the risk-free rate of interest) is 6.5%, use the CAPM equation in order to find out what is the present 'cost of equity' of your company? Explain what is the meaning of the 'cost of equity'.

c. Choose two other companies, look up their "Beta" and report the names of these companies and their betas. Suppose you invest one third of your money in each of the stocks of these companies. What will the beta of the portfolio be? Given the data in (b), what will the Expected Rate of Return on this portfolio be? Do you feel that the three-stock portfolio is sufficiently diversified or does it still have risk that can be diversified away? Explain.

Assignment Expectations:

In a two-page report explain your answers thoroughly with references to the background materials. Make sure to demonstrate a strong understanding of the concept of beta and the risk/return trade off.

Grading Rubric: Click here.

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Part A (Functions):Ā  we can write our own functions; this is a good thing for when we need to do the same thing multiple times in a program, for improving code readability, and for reusing code between projects.

Take the following example, the divide_then_add() function Iā€™ve defined below. This function is defined using the keyword function. Immediately following function is a list of the arguments separated by commas, which consist of x and y in this case. The curly brackets { and } surround the code that will be run when the function is run, whatā€™s called the body of the function. Finally, the function is saved in the variable divide_then_add, the name of the function. Once you run this, you can do e.g. divide_then_add(2, 3) to run the function.

# Divides x by y, and then adds x and y to the result divide_then_add <- function (x, y) { (x/y) + x + y

}

The code in the body of a function can be any code and any amount of code (not just a single line), and the result of the last line of code in the body is what the function returns. Itā€™s also possible to create variables inside a function, but these variables are removed once the function is finished running.

# Multiply x by y, store in w, and add z multiply_add <- function (x, y, z) {

w <- x*y

w+z

}

Do the following.

1. Write a function to compute the mean of a numeric vector. Name your function sa6.mean. (You donā€™t need to check if the vector is numeric or has at least two elements.)

2. Write a function to compute a z-score from an observation, a mean, and a standard deviation. You should name your function sa6.z.score, and the first argument should be the observation, the second argument the mean, and the third argument the standard deviation. Use the z-formula from class, š‘§ = š‘„āˆ’ š‘  š‘„ , where š‘„ Ģ„ is the sample mean and š‘  the sample standard deviation.

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Part B (if...else statements): R programs can also be written so that they run different pieces of code, depending on whether certain conditions are set or not. The keywords if introduces a conditional, where it checks if cond is true, and if so, it runs the block of code between the first set of curly brackets. You can also optionally use the else keyword, to say what should happen if cond is false.

if (cond) {

# code to run if cond is true

} else {

# code to run otherwise

}

The following will print "More than five rows!" if the number of rows of df is five or more, and will print "Not more than five :(" if there are fewer than five rows.

if (nrow(df) >= 5) {

print("More than five rows!")

} else {

print("Not more than five :(")

}



The condition can be of arbitrary complexity by using logical operators like & and |, just like the conditions we write when we use subset().

Do the following using the built-in mtcars dataset. You can access it by typing mtcars.

1. Write an if...else statement to do the following.

ā€¢ If the median miles per gallon (mpg) is 20 or more, or the mean horsepower (hp) is 120 or more, print the standard deviation of the engine displacement (disp) using print().

ā€¢ Otherwise, calculate Pearsonā€™s š‘Ÿ for the correlation between weight (wt) and miles per gallon and print it using print().

2. Write an if statement to do the following. If the ratio of my_hp to my_mpg is greater than 5, print that ratio. Otherwise, do nothing. (You can find the ratio by dividing the first number by the second.)

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Part C (for loops): The last control structure weā€™ll practice is a for loop. In a for loop, the program loops through the elements of a vector, and then runs a block of code each

2 time. In the following loop, the program goes through the vector containing the numbers 1 through 15 using the variable i, and prints the result of i+i.

for (i in 1:15) {

print(i+i)

}



Itā€™s possible to loop through vectors of other types, too. For instance, the following will loop through the vector names using the variable name, append the string "LINK" to each, and then print that new string if the name is not "Daron". (You can see you can use other control structures like conditionals in loops, too.)

Ā 

names <- c("Aaron", "Baron", "Caron", "Daron", "Faron")

for (name in names) {

if (name != "Faron") {

print(paste(name, "LINK"))

Ā  Ā  Ā  Ā  Ā }

}

One more example: you can use the iterator variable to access other vectors or data frames at the same position. The following will iterate from 1 to 10, get that number element from the mpg vector of mtcars, multiply it by 10, and then print it.

for (i in 1:10) {

tmp <- mtcars$mpg[i] * 10

print(tmp)

}



Do the following:

1. Use rownames(mtcars) to get the vector containing the names of all the cars in the mtcars dataset. Then, loop through this vector using a for loop, and print the name of any car where the name is greater than or equal to 15 characters long. (Use nchar() to check the length of a string.)

2. Create a for loop that does the following:

ā€¢ Uses rownames(mtcars) to get a vector of the names of cars.

ā€¢ Iterates from 1 to as many rows as there are in mtcars (use nrow() to get the number of rows in a data frame).

ā€¢ For each row, prints the name of the car and that carā€™s miles per gallon (use paste() to put these together into one string, like paste(name, mpg)).

Answer: Part A Here's an implementation of the sa6.mean function: sa6.mean <...
Answer: It seems that there is a syntax error in the code near the end of the ...
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Here's the full code that has errors. Thx


#include <stdio.h>
#include <stdlib.h>
#include <string.h>
#include <time.h>

typedef struct {
Ā  Ā  char name[50];
Ā  Ā  char category;
Ā  Ā  char company[50];
Ā  Ā  float purchased_price;
Ā  Ā  float sale_price;
Ā  Ā  int quantity;
Ā  Ā  time_t purchased_date;
Ā  Ā  time_t production_date;
Ā  Ā  time_t expiry_date;
Ā  Ā  int store_code;
Ā  Ā  char currency[4];
Ā  Ā  long barcode;
} Item;

typedef struct {
Ā  Ā  time_t purchase_time;
Ā  Ā  Item *items;
Ā  Ā  int item_count;
} Receipt;

// Caesar cipher encryption
void encrypt_caesar_cipher(char *input, int key, char *output) {
Ā  Ā  int i = 0;
Ā  Ā  while (input[i] != '\0') {
Ā  Ā  Ā  Ā  char c = input[i];
Ā  Ā  Ā  Ā  if (isalpha(c)) {
Ā  Ā  Ā  Ā  Ā  Ā  char base = isupper(c) ? 'A' : 'a';
Ā  Ā  Ā  Ā  Ā  Ā  output[i] = (c - base + key) % 26 + base;
Ā  Ā  Ā  Ā  } else {
Ā  Ā  Ā  Ā  Ā  Ā  output[i] = c;
Ā  Ā  Ā  Ā  }
Ā  Ā  Ā  Ā  i++;
Ā  Ā  }
Ā  Ā  output[i] = '\0';
}

// Caesar cipher decryption
void decrypt_caesar_cipher(char *input, int key, char *output) {
Ā  Ā  encrypt_caesar_cipher(input, 26 - key, output);
}
// Function to generate a random item
Item create_random_item() {
Ā  Ā  Item item;
Ā  Ā  int category_random = rand() % 12;

Ā  Ā  // Assign random category
Ā  Ā  if (category_random <= 3) {
Ā  Ā  Ā  Ā  item.category = 'A';
Ā  Ā  } else if (category_random <= 7) {
Ā  Ā  Ā  Ā  item.category = 'B';
Ā  Ā  } else if (category_random <= 10) {
Ā  Ā  Ā  Ā  item.category = 'C';
Ā  Ā  } else {
Ā  Ā  Ā  Ā  item.category = 'D';
Ā  Ā  }

Ā  Ā  // Generate random values for item fields
Ā  Ā  char *names[4] = {"apple", "banana", "chocolate", "water bottle"};
Ā  Ā  strcpy(item.name, names[rand() % 4]);
Ā  Ā  strcpy(item.company, "ABC Company");
Ā  Ā  item.purchased_price = ((rand() % 100) + 1) / 10.0;
Ā  Ā  item.sale_price = item.purchased_price;
Ā  Ā  item.quantity = rand() % 10 + 1;
Ā  Ā  item.purchased_date = time(NULL);
Ā  Ā  item.production_date = item.purchased_date - (rand() % 60) * 24 * 60 * 60; Ā // 0-60 days before purchase
Ā  Ā  item.expiry_date = item.production_date + (rand() % 180) * 24 * 60 * 60; Ā // 0-180 days after production
Ā  Ā  item.store_code = rand() % 10000 + 1;
Ā  Ā  strcpy(item.currency, "USD");
Ā  Ā  item.barcode = generate_barcode(&item);

Ā  Ā  return item;
}
// Define function to create a random item
Item create_random_item() {
Ā  Ā  Item item;

Ā  Ā  // Set a random item name
Ā  Ā  char *names[] = {"Apple", "Banana", "Orange", "Pear", "Grapes", "Pineapple", "Watermelon", "Strawberry", "Mango", "Kiwi"};
Ā  Ā  int name_index = rand() % 10;
Ā  Ā  strcpy(item.name, names[name_index]);

Ā  Ā  // Set a random item category
Ā  Ā  char categories[] = {'A', 'B', 'C', 'D', 'E', 'F', 'G', 'H', 'I', 'J', 'K', 'L'};
Ā  Ā  int category_index = rand() % 12;
Ā  Ā  item.category = categories[category_index];

Ā  Ā  // Set a random item manufacturer
Ā  Ā  char *manufacturers[] = {"Apple Inc.", "Samsung", "Microsoft", "Google", "Amazon", "Sony", "Nike", "Adidas", "Puma", "Reebok"};
Ā  Ā  int manufacturer_index = rand() % 10;
Ā  Ā  strcpy(item.manufacturer, manufacturers[manufacturer_index]);

Ā  Ā  // Set a random purchased price
Ā  Ā  item.purchased_price = (float) (rand() % 100 + 1);

Ā  Ā  // Set a random sale price
Ā  Ā  item.sale_price = item.purchased_price * (1.0 + ((float) (rand() % 20 + 1) / 100.0));

Ā  Ā  // Set a random quantity
Ā  Ā  item.quantity = rand() % 10 + 1;

Ā  Ā  // Set a random purchased date
Ā  Ā  item.purchased_date = time(NULL) - (rand() % (30 * 24 * 60 * 60)); // up to 30 days ago

Ā  Ā  // Set a random production date
Ā  Ā  item.production_date = time(NULL) - (rand() % (365 * 24 * 60 * 60)); // up to 1 year ago

Ā  Ā  // Set a random expiry date (between 1 and 3 years from the production date)
Ā  Ā  item.expiry_date = item.production_date + ((rand() % 730) + 365) * 24 * 60 * 60;

Ā  Ā  // Set a random store code
Ā  Ā  item.store_code = rand() % 10000;

Ā  Ā  // Set a random currency
Ā  Ā  char *currencies[] = {"USD", "EUR", "GBP", "JPY", "CAD", "AUD", "CHF", "CNY"};
Ā  Ā  int currency_index = rand() % 8;
Ā  Ā  strcpy(item.currency, currencies[currency_index]);

Ā  Ā  // Set a random barcode
Ā  Ā  item.barcode = generate_barcode(&item);

Ā  Ā  return item;
}
void encrypt_caesar_cipher(char *input, int key, char *output) {
Ā  Ā  int i = 0;
Ā  Ā  while (input[i] != '\0') {
Ā  Ā  Ā  Ā  char c = input[i];
Ā  Ā  Ā  Ā  if (isalpha(c)) {
Ā  Ā  Ā  Ā  Ā  Ā  char base = isupper(c) ? 'A' : 'a';
Ā  Ā  Ā  Ā  Ā  Ā  output[i] = (c - base + key) % 26 + base;
Ā  Ā  Ā  Ā  } else {
Ā  Ā  Ā  Ā  Ā  Ā  output[i] = c;
Ā  Ā  Ā  Ā  }
Ā  Ā  Ā  Ā  i++;
Ā  Ā  }
Ā  Ā  output[i] = '\0';
}

unsigned long generate_barcode(Item *item) {
Ā  Ā  // Encrypt the required fields
Ā  Ā  char encrypted_name[100], encrypted_company[100];
Ā  Ā  encrypt_caesar_cipher(item->name, 3, encrypted_name);
Ā  Ā  encrypt_caesar_cipher(item->company, 3, encrypted_company);

Ā  Ā  // Combine the encrypted information to generate a barcode (just as an example, not an actual barcode)
Ā  Ā  unsigned long barcode = 0;
Ā  Ā  for (int i = 0; encrypted_name[i] != '\0'; i++) {
Ā  Ā  Ā  Ā  barcode += encrypted_name[i];
Ā  Ā  }
Ā  Ā  for (int i = 0; encrypted_company[i] != '\0'; i++) {
Ā  Ā  Ā  Ā  barcode += encrypted_company[i];
Ā  Ā  }

Ā  Ā  return barcode;
}
void generate_receipt(Item* items, int num_items) {
Ā  Ā  Receipt receipt;
Ā  Ā  receipt.purchase_time = time(NULL);
Ā  Ā  receipt.items = items;
Ā  Ā  receipt.item_count = num_items;
Ā  Ā  print_receipt(&receipt);
}
int main() {
Ā  Ā  srand(time(NULL));
Ā  Ā  int num_items = 5;
Ā  Ā  Item items[num_items];
Ā  Ā  for (int i = 0; i < num_items; i++) {
Ā  Ā  Ā  Ā  items[i] = create_random_item();
Ā  Ā  Ā  Ā  apply_discounts(&items[i], time(NULL));
Ā  Ā  }
Ā  Ā  generate_receipt(items, num_items);
Ā  Ā  return 0;
}

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In your view, is this the appropriate role for government policy?

The War on Poverty is not a struggle simply to support people," declared President Lyndon B. Johnson in 1964. "It is an effort to allow them to develop and use their capacities." During the 20 years before the War on Poverty was funded, the portion of the nation living in poverty had dropped to 14.7% from 32.1%. Since 1966, the first year with a significant increase in antipoverty spending, the poverty rate reported by the Census Bureau has been virtually unchanged.

Last year a United Nations investigator using census data found "shocking" evidence that 40 million Americans live in "squalor and deprivation," in a country where "tax cuts will fuel a global race to the bottom." He continued: "The criminal justice system is effectively a system for keeping the poor in poverty," and reported that "the demonizing of taxation means that legislatures effectively refuse to levy taxes."

If that doesn't sound like the country you live in, that's because it isn't. The Census Bureau counts as poor all people in families with incomes lower than the established income thresholds for their respective family size and composition. The thresholds, first set in 1963, are based on a multiple of the cost of a budget for adequately nutritious food, adjusted for inflation. While the Census Bureau reports that in 2016 some 12.7% of Americans lived in poverty, it is impossible to reconcile this poverty rate, which has remained virtually unchanged over the last 50 years, with the fact that total inflation-adjusted government-transfer payments to low-income families have risen steadily. Transfers targeted to low-income families increased in real dollars from an average of $3,070 per person in 1965 to $34,093 in 2016.

Even these numbers significantly understate transfer payments to low-income families since they exclude Medicare and Social Security, which provide large subsidies to low-income retirees. Compared with what they pay in Social Security taxes, the lowest quintile of earners can receive as much as 10 times the lifetime benefits received by the highest quintile of earners and three times as much as the middle quintile.

The measured poverty rate has remained virtually unchanged only because the Census Bureau doesn't count most of the transfer payments created since the declaration of the War on Poverty. The bureau measures poverty using what it calls "money income," which includes earned income and some transfer payments such as Social Security and unemployment insurance. But it excludes food stamps, Medicaid, the portion of Medicare going to low-income families, Children's Health Insurance, the refundable portion of the earned-income tax credit, at least 87 other means-tested federal payments to individuals, and most means-tested state payments. If government counted these missing $1.5 trillion in annual transfer payments, the poverty rate would be less than 3%.

The 3% poverty rate determined by counting more of the government transfers to low-income families is virtually identical to the number economists Bruce Meyer and James Sullivan found in a 2016 study, which measured actual consumption by poor families. The number also reconciles the current disparity between the low income levels used by the Census Bureau to define poverty and studies such as the Department of Energy Residential Consumption Survey, which find consistently rising spending among poor families on cars, home electronics, cable, household appliances, smartphones and living space. The 3% poverty rate would fall even further if it accounted for transfers within families, some $500 billion of private charitable giving, and the multibillion-dollar informal economy, where income is unreported.

Transfer payments essentially have eliminated poverty in America. Transfers now constitute 84.2% of the disposable income of the poorest quintile of American households and 57.8% of the disposable income of lower-middle-income households. These payments also make up 27.5% of America's total disposable income.

The stated goal of the War on Poverty is not just to raise living standards, but also to make America's poor more self-sufficient and to bring them into the mainstream of the economy. In that effort the war has been an abject failure, increasing dependency and largely severing the bottom fifth of earners from the rewards and responsibilities of work.

In 1965, before funds were appropriated for War on Poverty programs, all five income quintiles had more families in which at least one person worked than families in which the head of household was of prime working age. So broadly based was the work ethic that the lowest income quintile had only 5.4% more families with working-age heads and no one working than did the middle quintile. The lower-middle quintile actually had proportionately fewer families where no one worked than did the middle quintile.

The expanding availability of antipoverty transfers has devastated the work effort of poor and lower-middle income families. By 1975 the lowest-earning fifth of families had 24.8% more families with a prime-work age head and no one working than did their middle-income peers. By 2015 this differential had risen to 37.1%. And by that same year, even families in the lower-middle income quintile headed by working-age persons were almost 6% more likely to have no one working than a similar family in the middle-income quintile.

Even these numbers understate the decline in work among low-income Americans that has accompanied the War on Poverty. Compared with the low-income quintile, the lower-middle quintile today has three times as many families with two or more workers, and the middle quintile has five times as many. The trend illustrates how the War on Poverty produced an unprecedented decline in work effort among those who received benefits.

The massive reduction in material poverty that government transfers have allowed has come at a considerable underappreciated cost. The War on Poverty has increased dependency and failed in its primary effort to bring poor people into the mainstream of America's economy and communal life. Government programs replaced deprivation with idleness, stifling human flourishing. It happened just as President Franklin Roosevelt said it would: "The lessons of history," he said in 1935, "show conclusively that continued dependency upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber."

---

Mr. Gramm is a former Chairman of the Senate Banking Committee. Mr. Early served twice as assistant commissioner at the Bureau of Labor Statistics and is president of Vital Few LLC. Bob Ekelund and Mike Solon contributed to this article.

Credit: By Phil Gramm and John F. Early

Answer: In my view, government policy should be focused on providing opportuni...

1. Summarize the pricing strategy in a few sentences. Is it a MC=MR strategy|?

2. Does this kind of pricing strategy discriminate against the poor? How about the strategy of selling in bulk? Should it be against the law or should markets be free to work here, with buyers and sellers making transactions on their own terms without the hand of government intervening?

3. Can you think of any other examples of this kind of pricing strategy - legal or not?

Poor? Pay Up.
Having Little Money Often Means No Car, No Washing Machine, No Checking Account And No Break From Fees and High Prices

You have to be rich to be poor.

That's what some people who have never lived below the poverty line don't understand.

Put it another way: The poorer you are, the more things cost. More in money, time, hassle, exhaustion, menace. This is a fact of life that reality television and magazines don't often explain.

So we'll explain it here. Consider this a primer on the economics of poverty.

"The poor pay more for a gallon of milk; they pay more on a capital basis for inferior housing," says Rep. Earl Blumenauer (D-Ore.). "The poor and 100 million who are struggling for the middle class actually end up paying more for transportation, for housing, for health care, for mortgages. They get steered to subprime lending. . . . The poor pay more for things middle-class America takes for granted."

Poverty 101: We'll start with the basics.

Like food: You don't have a car to get to a supermarket, much less to Costco or Trader Joe's, where the middle class goes to save money. You don't have three hours to take the bus. So you buy groceries at the corner store, where a gallon of milk costs an extra dollar.

A loaf of bread there costs you $2.99 for white. For wheat, it's $3.79. The clerk behind the counter tells you the gallon of leaking milk in the bottom of the back cooler is $4.99. She holds up four fingers to clarify. The milk is beneath the shelf that holds beef bologna for $3.79. A pound of butter sells for $4.49. In the back of the store are fruits and vegetables. The green peppers are shriveled, the bananas are more brown than yellow, the oranges are picked over.

(At a Safeway on Bradley Boulevard in Bethesda, the wheat bread costs $1.19, and white bread is on sale for $1. A gallon of milk costs $3.49 -- $2.99 if you buy two gallons. A pound of butter is $2.49. Beef bologna is on sale, two packages for $5.)

Prices in urban corner stores are almost always higher, economists say. And sometimes, prices in supermarkets in poorer neighborhoods are higher. Many of these stores charge more because the cost of doing business in some neighborhoods is higher. "First, they are probably paying more on goods because they don't get the low wholesale price that bigger stores get," says Bradley R. Schiller, a professor emeritus at American University and the author of "The Economics of Poverty and Discrimination."

"The real estate is higher. The fact that volume is low means fewer sales per worker. They make fewer dollars of revenue per square foot of space. They don't end up making more money. Every corner grocery store wishes they had profits their customers think they have."

According to the Census Bureau, more than 37 million people in the country live below the poverty line. The poor know these facts of life. These facts become their lives.

Time is money, they say, and the poor pay more in time, too.

When you are poor, you don't have the luxury of throwing a load into the washing machine and then taking your morning jog while it cycles. You wait until Monday afternoon, when the laundromat is most likely to be empty, and you put all of that laundry from four kids into four heaps, bundle it in sheets, load a cart and drag it to the corner.

"If I had my choice, I would have a washer and a dryer," says Nya Oti, 37, a food-service worker who lives in Brightwood. She stands on her toes to reach the top of a washer in the laundromat on Georgia Avenue NW and pours in detergent. The four loads of laundry will take her about two hours. A soap opera is playing loudly on the television hanging from the ceiling. A man comes in talking to himself. He drags his loads of dirty sheets and mattress pads and dumps them one by one into the machines next to Oti.

She does not seem to notice. She is talking about other costs of poverty. "My car broke down this weekend, and it took a lot of time getting on the bus, standing on the bus stop. It was a waste of a whole lot of times. Waiting. The transfer to the different bus."

When she has her car, she drives to Maryland, where she shops for her groceries at Shoppers Food Warehouse or Save-A-Lot, where she says some items are cheaper and some are higher. "They have a way of getting you in there on a bargain. You go in for something cheap, but something else is more expensive." She buys bags of oranges or apples, but not the organic kind. "Organic is too much," she says.

"When you are poor, you substitute time for money," says Randy Albelda, an economics professor at the University of Massachusetts at Boston. "You have to work a lot of hours and still not make a lot of money. You get squeezed, and your money is squeezed."

The poor pay more in hassle: the calls from the bill collectors, the landlord, the utility company. So they spend money to avoid the hassle. The poor pay for caller identification because it gives them peace of mind to weed out calls from bill collectors.

The rich have direct deposit for their paychecks. The poor have check-cashing and payday loan joints, which cost time and money. Payday advance companies say they are providing an essential service to people who most need them. Their critics say they are preying on people who are the most "economically vulnerable."

"As you've seen with the financial services industry, if people can cut a profit, they do it," Blumenauer says. "The poor pay more for financial services. A lot of people who are 'unbanked' pay $3 for a money order to pay their electric bill. They pay a 2 percent check-cashing fee because they don't have bank services. The reasons? Part of it is lack of education. But part of it is because people target them. There is evidence that credit-card mills have recently started trolling for the poor. They are targeting the recently bankrupt."

Outside the ACE check-cashing office on Georgia Avenue in Petworth, Harrison Blakeney, 67, explains a hard financial lesson of poverty. He uses the check-cashing store to pay his telephone bill. The store charges 10 percent to take Blakeney's money and send the payment to the phone company. That 10 percent becomes what it costs him to get his payment to the telephone company on time. Ten percent is more than the cost of a stamp. But, Blakeney says: "I don't have time to mail it. You come here and get it done. Then you don't get charged with the late fee."

Blakeney, a retired auto mechanic who now lives on a fixed income, says: "We could send the payment ahead of time but sometimes you don't have money ahead of time. That's why you pay extra money to get them to send it."

Blakeney, wearing a purple jacket, leans on his cane. He has no criticism for the check-cashing place. "That's how they make their money," he says. "I don't care about the charge."

Just then, Lenwood Brooks walks out of the check-cashing place. He is angry about how much it just cost him to cash a check. "They charged me $15 to cash a $300 check," he says.

You ask him why he didn't just go to a bank. But his story is as complicated as the various reasons people find themselves in poverty and in need of a check-cashing joint. He says he lost his driver's license and now his regular bank "won't recognize me as a human. That's why I had to come here. It's a rip-off, but it's like a convenience store. You pay for the convenience."

Then there's credit. The poor don't have it. What they had was a place like First Cash Advance in D.C.'s Manor Park neighborhood, where a neon sign once flashed "PAYDAY ADVANCE." Through the bulletproof glass, a cashier in white eyeliner and long white nails explained what you needed to get an advance on your paycheck -- a pay stub, a legitimate ID, a checkbook. This meant you're doing well enough to have a checking account, but you're still poor.

And if you qualify, the fee for borrowing $300 is $46.50.

That was not for a year -- it's for seven days, although the terms can vary. How much interest will this payday loan cost you? In simple terms, the company is charging a $15.50 fee for every $100 that you borrow. On your $300 payday loan -- borrowed for a term of seven days -- the effective annual percentage rate is 806 percent.

The cashier says that what you do is write First Cash Advance a check for $345.50 plus another $1 fee, and it will give you $300 in cash upfront. It holds the check until you get paid. Then you bring in $346.50 and it returns your check. Or it cashes the check and keeps your $346.50, or you have the option of extending the loan with additional fees. You'll be out $46.50, which you'd rather have for the late fee on the rent you didn't pay on time. Or the gas bill you swear you paid last month but the gas company swears it never got.

But now the payday advance place has closed, shuttered by metal doors. A sign in the front door says the business has moved. After the D.C. government passed a law requiring payday lenders to abide by a 24-percent limit on the annual percentage rate charged on a loan, many such stores in the District closed. Now advocates for the poor say they are concerned about other businesses that prey on poor people by extending loans in exchange for car titles. If a person does not pay back the loan, then the business becomes the owner of the car.

All these costs can lead the poor to a collective depression. Douglas J. Besharov, resident scholar at the American Enterprise Institute, says: "There are social costs of being poor, though it is not clear where the cause and effect is. We know for a fact that on certain measures, people who are poor are often more depressed than people who are not. I don't know if poverty made them depressed or the depression made them poor. I think the cause and effect is an open question. Some people are so depressed they are not functional. 'I live in a crummy neighborhood. My kids go to a crummy school.' That is not the kind of scenario that would make them happy." Another effect of all this, he says: "Would you want to hire someone like that?"

The poor suspect that prices are higher where they live, even the prices in major supermarkets. The suspicions sometimes spill over into frustration.

On a hot spring afternoon, Jacob Carter finds himself standing in a checkout line at the Giant on Alabama Avenue SE. Before the cashier finishes ringing up his items, he puts $43 on the conveyor belt. But his bill comes to $52.07. He has no more money, so he tells the clerk to start removing items.

The clerk suggests that he use his "bonus card" for savings.

Carter tells the clerk he has no such card.

He puts back the liter of soda. Puts back the paper towels. Sets aside $9 worth of hot fried chicken wings. He returns $13 worth of groceries. "Y'all got some high prices in this [expletive]," he says, standing in Aisle 4, blue shirt over work clothes.

The clerk suggests that he take his cash off the conveyor belt, because if she moves the belt the money will be carried into the machinery. Then the money will be gone.

Carter, a building engineer, snatches up the money, then gives it to the clerk. His final bill is $39.07.

He looks at the receipt and then announces without the slightest indication as to why: "Just give me all my [expletive] money back. It's too high in this [expletive]." The clerk calls the supervisor, who comes over. The supervisor doesn't argue with Carter. She just starts the process of giving him a refund.

"I want my money back. This [expletive] is too high. My grandmother told me about this store."

The supervisor returns $39.07 in cash. "Sir," she says, "have a blessed day."

The food in this supermarket might be cheaper than the goods at a corner store. But Carter still feels frustrated by what he thinks is a mark-up on prices in supermarkets in poor neighborhoods. Carter walks out.

The poor pay in other ways, ways you might never imagine. Jeanette Reed, who is retired and lives on a fixed income, sold her blood when she needed money. "I had no other source to get money," she says. "I went to the blood bank. And they gave me $30.

"I needed the money. I didn't have the money and no source of getting money. No gas. No food. I have to go to a center that gives out boxes of food once a month. They give you cereal or vouchers for $10. They give you canned tuna and macaroni and cheese. Crackers and soup. They give you commodities like day-old bread."

The poor know the special economics of their housing, too.

"You pay rent that might be more than a mortgage," Reed says. "But you don't have the credit or the down payment to buy a house. Apartments are not going down. They are going up. They say houses are better, cheaper. But how are you going to get in a house if you don't have any money for a down payment?"

There is also an economic cost to living in low-income neighborhoods.

"The cheaper housing is in more-dangerous areas," says Reed, who lives in Southeast Washington. "I moved out of my old apartment. I hate that area. They be walking up and down the street. Couldn't take the dog out at night because strangers walking up and down the street. They will knock on your door. Either they rob you, kill or ask for money. If you're not there, they will steal air conditioners and copper. They will sell your copper [pipes] for money."

And then there is the particular unpleasantness when you make too much money to fall below the poverty line, but not enough to move up, up and away from it.

For our final guest lecturer on poverty we take you to the Thrift Store on Georgia Avenue and Marie Nicholas, 35, in an orange shirt, purple pants and thick black eyeliner. She is what economists call the working poor.

She is picking through the racks. The store is busy with customers on a Monday afternoon. There is the shrill sound of hangers sliding across racks under fluorescent lights. An old confirmation dress hangs from the ceiling. It has faded to yellow. It's not far from the used silver pumps, size 9 1/2 , nearly new, on sale for $9.99.

"People working who don't make a lot of money go to the system for help, and they deny them," Nicholas says. "They say I make too much. It almost helps if you don't work."

She says she makes $15 an hour working as a certified nursing assistant. She pays $850 for rent for a one-bedroom that she shares with her boyfriend and child. She went looking for a two-bedroom unit recently and found it would cost her $1,400. She pays $300 a month for child care for her 11-year-old son, who is developmentally delayed. She tried to put him in a subsidized child-care facility, but was told she makes too much money. "My son was not chosen for Head Start because I wasn't in a shelter or on welfare. People's kids who do go don't do nothing but sit at home."

Money and time. "I ride the bus to get to work," Nicholas says. It takes an hour. "If I could drive, it would take me 10 minutes. I have to catch two buses." She gets to the bus stop at 6:30 a.m. The bus is supposed to come every 10 or 15 minutes. Sometimes, she says, it comes every 30 minutes.

What could you accomplish with the lost 20 minutes standing there in the rain? Waiting. That's another cost of poverty. You wait in lines. You wait at bus stops. You wait on the bus as it makes it way up Georgia Avenue, hitting every stop. No sense in trying to hurry when you are poor.

When you are poor, you wait.

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