Income and wealth Flashcards
(10 cards)
1
Q
what is wealth?
A
a stock of assets
2
Q
most wealth is…
A
inherited
3
Q
what is income?
A
a flow of monies
4
Q
give examples of income
A
- work
- renting out a home
5
Q
give examples of wealth
A
- land
- savings
- your house
6
Q
how is income distribution measured?
A
the lorenze curve
7
Q
what is the gini coefficient?
A
quantifies the lorenz curve
8
Q
what are the two types of poverty?
A
absolute = cant afford basic necessities like food and shelter
relative = earning less than 60% of the average in the uk (20% of the uk is in relative poverty)
9
Q
what negative externalities does poverty carry?
A
- crime
- consumption of demerit goods like alcohol or cigarettes
- higher NHS costs
10
Q
ways to reduce poverty
A
- taper benefits
- increase the minimum wage
- cut income tax
- training/education (long term)
