Lesson 4.1.7.2

4.1.7.2 The problem of poverty Quiz: AQA Economics, Unit 1

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 4.1.7.2, The problem of poverty: 20 multiple choice questions for the AQA Economics (7136), Unit 1: Individuals, firms, markets and market failure, written with Revision Ninja.

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The 20 questions

  1. Which term describes lacking the basic necessities required for human survival?

    • Relative poverty
    • Income inequality
    • Absolute poverty
    • Subjective poverty

  2. In the UK, relative poverty is officially measured as household income below what percentage of median income?

    • 75%
    • 60%
    • 40%
    • 50%

  3. Which factor is a primary cause of persistent household poverty?

    • Rising asset prices
    • Increased labour productivity
    • High progressive taxes
    • Long-term unemployment

  4. What is a direct negative impact of persistent poverty on human capital?

    • Greater job security
    • Lower educational attainment
    • Increased life expectancy
    • Higher wage mobility

  5. Median income is £30,000. Using the 60% threshold, what maximum income places a household in relative poverty?

    • £18,000
    • £20,000
    • £15,000
    • £24,000

  6. What primary mechanism causes a poverty trap when low-income workers earn additional wages?

    • Minimum wage ceilings
    • Regressive corporation tax
    • High benefit withdrawal rates
    • Low marginal utility

  7. Median income rises while the poorest incomes stay constant. What happens to relative poverty?

    • It remains unchanged
    • It increases
    • It decreases
    • Absolute poverty falls

  8. If a household's nominal income rises by 3% while inflation is 5%, what happens to real income?

    • It rises by 8%
    • It falls
    • It remains constant
    • It rises by 2%

  9. What is a major macroeconomic cost of high levels of poverty?

    • Lower government spending
    • Reduced tax revenues
    • Increased demand-pull inflation
    • Higher economic growth

  10. Which of the following represents a structural cause of poverty?

    • Temporary cyclical downturn
    • Frictional unemployment
    • Technological skill obsolescence
    • Seasonal unemployment

  11. Which benchmark is standard for measuring relative poverty in the UK?

    • 60% of median
    • 70% of average
    • 80% of median
    • 50% of mean

  12. What situation prevents low-income workers from increasing disposable income when earning more?

    • Wealth squeeze
    • Poverty trap
    • Unemployment trap
    • Fiscal drag

  13. Gross wage rises by £2,000, benefits fall by £1,500, and tax rises by £300. Change in disposable income?

    • +£500
    • +£1,800
    • +£200
    • -£200

  14. How does persistent child poverty primarily harm long-run economic growth?

    • Higher inflation rates
    • Reduced human capital
    • Increased import demand
    • Lower nominal wages

  15. Which causes relative poverty to rise while absolute poverty falls?

    • Uneven income growth
    • Equal income growth
    • Zero wage growth
    • Deflationary economic policy

  16. Which social outcome is most directly associated with relative poverty?

    • Hyperinflation
    • Social exclusion
    • Cultural assimilation
    • Absolute starvation

  17. A poverty line set as a fixed cost for a basic basket of goods measures:

    • Relative poverty
    • Income inequality
    • Absolute poverty
    • Wealth inequality

  18. Absolute poverty occurs when a household cannot afford:

    • Basic survival needs
    • Luxury consumer items
    • Average societal goods
    • Private healthcare

  19. The transmission of poverty from parents to their children across generations is called:

    • Intergenerational poverty
    • Relative deprivation
    • Structural unemployment
    • The poverty trap

  20. Official UK poverty statistics adjust household disposable income using which technique?

    • Depreciation
    • Equivalisation
    • Indexation
    • Progressivity

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