Macro A2 - Absolute & Relative Poverty

Question 1

Absolute poverty

Answer 1

Where household income is bellow a necessary level to maintain basic living standards

Question 2

Relative poverty

Answer 2

Where household income is a certain percentage below median incomes.

Question 3

Measures of absolute poverty

Answer 3

World bank - $1.90 pp
Uk - household income is below 60% of the median in base year (adjusted for inflation)

Question 4

Measures of relative poverty

Answer 4

Relative poverty is when households receive 50% less than average household incomes.

Question 5

Causes of changes in absolute poverty

Answer 5

• Economic growth
• The level of gdp
• government tax & benefit policies

Question 6

Causes of changes in relative poverty

Answer 6

• the level of asset prices
• trade liberalisation
• level of government benefits