Podcast
Questions and Answers
What is the primary distinction between absolute and relative poverty?
What is the primary distinction between absolute and relative poverty?
Which of the following best exemplifies absolute poverty?
Which of the following best exemplifies absolute poverty?
What percentage of the median household income in the UK signifies relative poverty?
What percentage of the median household income in the UK signifies relative poverty?
In which type of country is absolute poverty more commonly found?
In which type of country is absolute poverty more commonly found?
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What threshold defined absolute poverty according to the World Bank in 2022?
What threshold defined absolute poverty according to the World Bank in 2022?
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Study Notes
Poverty Definitions
- Poverty is a lack of financial resources to maintain a basic living standard.
- Economists differentiate between absolute and relative poverty.
- Absolute poverty means individuals can't afford basic necessities for a healthy life (shelter, water, nutrition, clothing, healthcare).
- In 2022, the World Bank defined absolute poverty as living on less than $1.90 per day.
- Absolute poverty is more common in developing countries.
- Relative poverty is when household income is below a certain percentage of the median income in the economy.
- Relative poverty is primarily found in developed nations.
- Relative poverty considers income differences among households.
- For example, the UK defines relative poverty as households earning less than 60% of the median household income.
UK Relative Poverty Example (May 2022)
- UK's median monthly household income was £2,072.
- Relative poverty line was set at £1,243.20 per month (60% of £2,072).
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Description
This quiz covers the essential definitions of poverty, highlighting the differences between absolute and relative poverty. You will learn about how these concepts are measured and their relevance in developing and developed countries. The latter part focuses specifically on the UK’s relative poverty example as of May 2022.
