Understanding Equity and Poverty

What is the difference between equity and equality?

• Equity is about fairness, while equality is about treating everyone the same.

• Equity is about treating everyone the same, while equality is about fairness.

• Both equity and equality are the same.

• Equity and equality are unrelated concepts.

Which of the following refers to horizontal equity?

• People with higher incomes should pay more taxes.

• Consumers and others should pay the same level of taxation.

• Resources are allocated equally to all.

• Taxation should be proportional to the income level.

Which statement best describes vertical equity?

• Everyone is taxed the same amount.

• The poor are taxed more than the rich.

• Taxes are apportioned based on ability to pay, with the rich paying more.

• Taxes are reduced for high earners.

Which of the following describes absolute poverty?

• A household's income falls below a set percentage of median household income.

• A household cannot afford basic necessities needed for survival.

• A household can afford basic needs but not luxury items.

• A household is able to purchase goods and services typical in society.

Relative poverty occurs when:

• A person's income is insufficient to meet basic needs.

• A household's income falls below a specified percentage of the median income.

• A person cannot afford luxury items.

• A person earns below the poverty line of PPP $1.90.

What does the term 'poverty trap' mean?

• A situation where high taxes discourage working.

• A situation where individuals have no incentive to work due to loss of benefits.

• A situation where wages are too low to live on.

• A situation where individuals face discrimination in the job market.

What is the international poverty line set at?

• $2.50

• PPP $1.90

• $1.00

• $3.50

Which of the following is NOT an example of means-tested benefits?

• Housing benefits

• Unemployment benefits

• Universal basic income

• Food vouchers

Universal basic income is defined as:

• Benefits provided only to the unemployed.

• A cash payment made by the government regardless of income or employment status.

• A benefit based on income level.

• A once-in-a-lifetime government payout.

One potential disadvantage of universal basic income is:

• It reduces poverty levels.

• It increases the complexity of welfare schemes.

• It may be given to those who do not need it.

• It helps people find jobs easily.