2.7 - income distribution / welfare

Question 1

Income

Answer 1

Flow of money into FoP

Question 2

Income distribution

Answer 2

How a country’s GDP is spread across the nation

Question 3

Income inequality

Answer 3

Unequal distribution of income amongst a population

Question 4

Wealth

Answer 4

Current value of a stock of assets owned

Question 5

Absolute poverty

Answer 5

Not having the ability to purchase G+S required for minimal standard of living

Question 6

Relative Poverty

Answer 6

Better off than absolute poverty
Worse off than a median income

Question 7

Causes of poverty / inequality

Answer 7

Rising living costs
Lack of social mobility
Unemployment
Poor education
Discrimination
Natural disasters

Question 8

Consequences of poverty / inequality

Answer 8

Health issues
Inability to purchase basic goods for survival
Homelessness
Social friction
Less C - fall in AD

Question 9

Gini Coefficient

Answer 9

Rates country’s inequality between 0-1
Closer to 1 = higher inequality

Question 10

Lorenz curve

Answer 10

Shows proportion of national income earned by any percentage of the population
Shows change in income distribution over time