2-poverty & inequality

Question 1

absolute poverty

Answer 1

unable to afford sufficient necessities to maintain life, <$1.90 a day

Question 2

relative poverty

Answer 2

peoples incomes compared to others in an area, earning less than the average wage

Question 3

causes of poverty

Answer 3

Unemployment
Lack of skills
Health problems
Income dependency

Question 4

what happens to absolute poverty as GDP rises

Answer 4

absolute poverty falls

Question 5

causes for relative poverty

Answer 5

-inequality of wages growth
-deindustrialisation
-growth in unemployment, zero-hour contracts, part-time jobs and temporary jobs
-decline of trade unions

Question 6

wealth

Answer 6

stock of assets

Question 7

income

Answer 7

flow of earnings

Question 8

measurements of income inequality

Answer 8

-lorenze curve
-gini coefficient

Question 9

what does the Lorene curve show

Answer 9

cumulative percentage of population plotted against the cumulative percentage of income

Question 10

what is the gini coefficient

Answer 10

A/(A+B), measured between 1 and 0, the bigger the coefficient the ,more unequal

Question 11

causes of wealth and income inequality

Answer 11

-wages(workers earning more than others)
-wealth levels
-chance (those who buy houses in the right area)
-age

Question 12

significance of capitalism

Answer 12

-leads to inequality
-individuals own resources thus wealth differs based on assets
-inequality is essential for capitalism but excessive inequality causes problems