Over a five-year period in a developing economy, the share of total national income received by the poorest 20% of households rose from 4% to 7%, while the share received by the richest 20% fell from 48% to 43%. Over this same period, real GDP increased by 15% and the total population (as well as the number of households) remained constant.
Which of the following statements must be correct?
The absolute real income received by the richest 20% of households decreased.
The Gini coefficient for this economy must have increased.
The absolute real income received by the poorest 20% of households more than doubled.
The share of national income received by the middle 60% of households decreased.
76 exam-style questions on AQA A Level Economics 1.7 The distribution of income and wealth: poverty and inequality (A-level only), covering 1.7.1 The distribution of income and wealth, 1.7.2 The problem of poverty, and 1.7.3 Government policies to alleviate poverty and to influence the distribution of income and wealth. Each one has a worked solution and a mark scheme showing where the marks go.