Ch 22 - Economic inequality and poverty

Inequalities of opportunities

________: when a person isn't earning as much, meaning they cant afford to buy assets.

Minimum wage

________: minimum amount of remuneration that an employer can legally pay a worker.

Transfer payments

________: governments use tax revenues to redistribute income and provide different types of assistance to groups in the economy to improve their living standards and opportunities.

Progressive income

________ tax structure which makes the distribution of income more equal will offset to some extent by the countrys indirect taxes.

lack of equity

Raising levels of inequality in income, wealth, and opportunity reflect a(n) ________.

Indirect taxes

________ care an important source of revenue for governments, and can be used to discourage the consumption of goods that create negative externalities.

Inequality

________ is inevitable since it influences productivity.

Equity

fairness in opportunities given to people despite their differences

Equality

disparities in incomes and wealth given to people

Inequality in outcomes

inequalities in income and wealth

Inequalities of opportunities

when a person isn't earning as much, meaning they cant afford to buy assets

PPP, purchasing power parity

means that it will buy approximately the same amount of goods and services in any country

Transfer payments

governments use tax revenues to redistribute income and provide different types of assistance to groups in the economy to improve their living standards and opportunities

Minimum wage

minimum amount of remuneration that an employer can legally pay a worker

**Equity**

fairness in opportunities given to people despite their differences 

**Equality**

disparities in incomes and wealth given to people

**Inequality**

is not determined by the level of national income

Inequality in outcomes

inequalities in income and wealth 

Inequalities of opportunities

when a person isn't earning as much, meaning they cant afford to buy assets 

**PPP, purchasing power parity**

means that it will buy approximately the same amount of goods and services in any country 

**Multidimensional Poverty Index (MPI)** \n

people who are in extreme poverty and lack the three dimensions: education, healthy, and standard of living

**Consequences of inequality and poverty** 

* Harms economic growth 
* Decreased quantity of living standards and social stability 

**Minimum wage**

minimum amount of remuneration that an employer can legally pay a worker 

**Progressive** income tax structure

makes the distribution of income more equal will offset to some extent by the country’s indirect taxes