Wealthy countries have people who live in relative poverty. What is the most likely cause of this?

A.
generous state pensions
B.
low national minimum wage
C.
progressive taxation
D.
subsidised healthcare
Economics
IGCSE&ALevel
CAIE
Exam No:0455_m25_qp_12 Year:2025 Question No:25

Answer:

B

Knowledge points:

5.1.1.1. Real GDP per head and the Human Development Index (HDI).
5.1.1.2. The components of real GDP and HDI.
5.1.1.3. The advantages and disadvantages of real GDP and HDI.
5.1.2.1. Reasons for differences in living standards and income distribution within and between countries.
5.2.1 definition of absolute and relative poverty
5.2.2 the causes of povertyincluding unemployment, low wages, illness and age.
5.2.3 policies to alleviate poverty and redistribute income:Policies including those promoting economic growth, improved education, more generous state benefits, progressive taxation, and national minimum wage

Solution:

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