Income and wealth

Question 1

Distribution of income/wealth

Answer 1

How income/wealth is divided between different groups in society e.g. rich/poor

Question 2

The link between wealth and income

Answer 2

If you have a high income, you are more likely to have money left over after living costs. You can therefore invest and add to income, therefore increasing wealth and vice versa

Question 3

Factors affecting distribution of income

Answer 3

-Taxation
-Inheritance, gifts and luck
-Wage salary differentials

Question 4

Equality

Answer 4

Means everyone gets the same e.g. the same slary or wages

Question 5

Equity

Answer 5

Means that the distribution is regarded as fair

Question 6

The lorenz curve

Answer 6

A graph to show the level of income inequality in a population. It compares the cumulative percentage of income received to the percentage of population receiving it,

Question 7

Gini coefficient

Answer 7

A statistical measure of economic inequality in a population. (0-1)