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5 marksIncome Inequality, Poverty and Poverty Alleviation

CAPE Economics Unit 1 · 2014 · Paper 2 · Question 6(b)(i)

Country A has a Gini coefficient of 0.61 and Country B has a Gini coefficient of 0.33.

Draw and label a diagram showing the Lorenz curve for both Country A and Country B. Indicate the line of equality on the diagram.

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Other parts of this question

  1. 6(a)(i)Distinguish between 'relative poverty' and 'absolute poverty'.[4 marks]
  2. 6(a)(ii)Outline TWO strategies that governments can employ to alleviate poverty.[4 marks]
  3. 6(b)(ii)Explain the concept of 'income inequality'.[3 marks]
  4. 6(b)(iii)Compare the income share of the bottom 50% of the population of Country A and Country B.[3 marks]
  5. 6(b)(iv)Outline THREE measures that the government of the country with higher inequality can implement to narrow the gap between the two countries.[6 marks]

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