Inequity

Question 1

Consumption by an individual depends on Wealth and Income

Answer 1

1. Income = money recieved over set period of time e.g. per week or per year
2. Income can come from many sources
3. Wealth is the value of money in assets held
4. The greater an individual’s income and wealth, the more goods and services they’re able to purchase

Question 2

Income and Wealth are not distributed equally

Answer 2

1.
2,
3,
4.
5.
6.
7.

Question 3

Governments might try to distribute income and wealth more Equally

Answer 3

1. Correcting market failure requires government intervention
2. The level of redistributing income reduces the incentive for individuals and firms to work hard.