Measurement and Causes of Poverty: A Comprehensive Guide for Development Economics

Question 1

Which of these is NOT a method used to measure poverty?

Accepted Answer

Gross Domestic Product (GDP)

Answer

Headcount ratio

Answer

Gini coefficient

Answer

Multidimensional Poverty Index (MPI)

Question 2

Which of the following is NOT a common indicator employed to measure absolute poverty?

Accepted Answer

Literacy rate

Answer

Income or consumption level

Answer

Access to safe drinking water

Answer

Life expectancy

Question 3

The graphical representation of income distribution within a society utilizes which tool?

Accepted Answer

Lorenz curve

Answer

Phillips curve

Answer

Production possibility frontier

Answer

GDP curve

Question 4

The concept of a 'poverty trap' refers to:

Accepted Answer

A situation where individuals remain in poverty due to interconnected factors that perpetuate their disadvantaged circumstances

Answer

A lack of access to essential resources

Answer

A tax system that disproportionately burdens the impoverished

Question 5

Which international organization publishes the Human Poverty Index (HPI)?

Accepted Answer

United Nations Development Programme (UNDP)

Answer

International Monetary Fund (IMF)

Answer

World Bank

Question 6

The definition of poverty as 'living on less than $1.90 per day' is based on the concept of:

Accepted Answer

Purchasing power parity (PPP)

Answer

Gross domestic product (GDP)

Answer

Gross national income (GNI)

Answer

Consumer price index (CPI)

Question 7

Which criticism is associated with the Sen-Dreze capability approach to poverty measurement?

Accepted Answer

The difficulty in quantifying capabilities

Answer

Failure to consider cultural variations

Answer

Overemphasis on subjective assessments

Answer

Excessive focus on material well-being

Question 8

The concept of 'multidimensional poverty' refers to:

Accepted Answer

Poverty experienced across multiple dimensions, encompassing aspects such as health, education, and living conditions

Answer

Poverty affecting multiple generations

Answer

Poverty restricted to a single dimension

Question 9

The definition of the 'relative poverty line' commonly refers to:

Accepted Answer

The income level below which a household falls behind the average standard of living in their society

Answer

The poverty line used for cross-country comparisons of poverty levels

Answer

The income level below which a household cannot afford basic necessities

Question 10

Which of the following is NOT exclusively used as a measure of poverty?

Accepted Answer

Human Development Index

Answer

Headcount ratio

Answer

Gini coefficient

Question 11

Define participatory poverty assessment and discuss its advantages and disadvantages.

Accepted Answer

Participatory poverty assessment involves engaging poor people in identifying poverty causes, setting priorities, and developing solutions.

Answer

Participatory poverty assessment relies on qualitative data to assess poverty.

Answer

Participatory poverty assessment is conducted by experts without involving the poor.

Answer

Participatory poverty assessment measures poverty based on income levels.

Question 12

The absolute poverty line is defined as the income level below which individuals cannot afford basic necessities, such as food, clothing, and shelter.

Accepted Answer

True

Answer

False

Question 13

The Gini coefficient measures:

Accepted Answer

Income inequality

Answer

Poverty prevalence

Answer

Human capital development

Answer

Economic growth

Question 14

Which of the following is a policy measure that can help reduce poverty?

Accepted Answer

Increasing access to quality education and healthcare

Answer

Reducing government spending on social programs

Answer

Reducing taxes on the wealthy

Answer

Deregulating the economy

Question 15

Relative poverty refers to:

Accepted Answer

Individuals falling below a certain income level relative to the rest of society in which they live

Answer

Individuals living in extreme poverty

Answer

Individuals lacking basic necessities

Question 16

A limitation of using the Gini coefficient to measure poverty is that it:

Accepted Answer

Does not consider non-income factors contributing to poverty, such as access to education and healthcare

Answer

Requires a lot of data to calculate

Answer

Is only applicable to developing countries

Question 17

Discrimination can be a significant cause of poverty because it:

Accepted Answer

Limits access to education, employment, and housing

Answer

Increases government spending

Answer

Lowers economic growth

Question 18

The World Bank's international poverty line is set at:

Accepted Answer

$1.90 per day at 2011 purchasing power parity (PPP)

Answer

$2.50 per day

Answer

$5.00 per day

Answer

$10.00 per day

Question 19

A criticism of using income as the sole poverty measure is that it:

Accepted Answer

Does not capture non-monetary aspects of deprivation, such as poor health, lack of access to education, or social exclusion

Answer

Is too difficult to measure accurately

Question 20

Which of the following is NOT a commonly used poverty line measure?

Accepted Answer

Median income

Answer

Relative poverty line

Answer

Absolute poverty line

Answer

Subjective poverty line

Question 21

The Gini coefficient measures:

Accepted Answer

Income inequality

Answer

Poverty incidence

Answer

Economic growth

Question 22

Which of the following is NOT considered a cause of poverty?

Accepted Answer

High levels of government spending

Answer

Discrimination

Answer

Lack of education

Answer

Unemployment

Question 23

The poverty trap refers to the situation where:

Accepted Answer

Individuals struggle to escape poverty due to limited resources and opportunities

Answer

Individuals are unwilling to work to improve their situation

Answer

Government policies create disincentives for work

Question 24

Which of the following is a potential benefit of economic growth for reducing poverty?

Accepted Answer

Increased job creation and income opportunities

Answer

Higher cost of living

Answer

Reduced government spending on social programs

Answer

Increased income inequality

Question 25

The concept of relative poverty is based on the idea that:

Accepted Answer

Poverty is defined in relation to the living standards of the rest of society

Answer

Poverty is solely a result of individual choices

Answer

Poverty is defined by absolute income levels

Question 26

The Kuznets curve suggests that:

Accepted Answer

Income inequality initially rises with economic growth but eventually declines

Answer

Income inequality always increases with economic growth

Answer

Income inequality always decreases with economic growth

Question 27

Which of the following is a potential consequence of poverty?

Accepted Answer

Poor health and reduced well-being

Answer

Improved educational attainment

Answer

Reduced crime rates

Answer

Increased economic growth

Question 28

The concept of multidimensional poverty recognizes that:

Accepted Answer

Poverty encompasses a range of deprivations, including income, health, and education

Answer

Poverty is always the result of individual choices

Answer

Government intervention is the only effective way to reduce poverty

Question 29

Which of the following is a widely implemented poverty reduction strategy?

Accepted Answer

Conditional cash transfers

Answer

Import substitution

Answer

Tax cuts for the wealthy

Answer

Currency devaluation

Question 30

Which of the following is a limitation of traditional poverty measurement approaches?

Accepted Answer

They often fail to capture important non-material aspects of well-being

Answer

They are overly precise

Answer

They are too difficult to collect

Question 31

What is a key advantage of using multidimensional poverty indices?

Accepted Answer

They provide a more comprehensive assessment of poverty

Answer

They are faster to collect

Answer

They are politically neutral

Answer

They are more precise than other measures

Question 32

What is a key responsibility of governments in combating poverty?

Accepted Answer

Establishing social protection systems

Answer

Attracting foreign investment

Answer

Deregulating the labor market

Answer

Reducing import tariffs

Question 33

Which of the following concepts is central to achieving sustainable poverty reduction?

Accepted Answer

Empowerment of individuals and communities

Answer

Fiscal austerity

Answer

Structural adjustment

Answer

Deflation

Question 34

Which of the following is NOT a factor considered when constructing the absolute poverty line?

Accepted Answer

Literacy rate

Answer

Life expectancy

Answer

Income

Answer

Essential goods and services

Question 35

The Gini coefficient, a measure of income inequality, is calculated on a scale from 0 to 1. What does a Gini coefficient of 1 indicate?

Accepted Answer

Perfect inequality

Answer

Perfect equality

Answer

Income mobility

Answer

Moderate inequality

Question 36

Which of the following is a potential cause of poverty rooted in human capital?

Accepted Answer

Lack of education

Answer

Economic growth

Answer

Natural disasters

Answer

Inflation

Question 37

In the context of poverty analysis, what is the significance of the Kuznets curve?

Accepted Answer

It demonstrates the relationship between economic growth and income inequality

Answer

It predicts the distribution of wealth within a society

Answer

It measures the speed at which poverty is reduced

Question 38

Which of the following is a potential benefit of using a relative poverty line over an absolute poverty line?

Accepted Answer

It allows for cross-country comparisons

Answer

It reflects the cost of living

Answer

It is more precise

Answer

It is less subjective

Question 39

Which of the following is a criticism of the headcount ratio as a measure of poverty?

Accepted Answer

It fails to consider the depth and severity of poverty

Answer

It is difficult to calculate

Answer

It requires a large sample size

Question 40

What is the Human Poverty Index (HPI) designed to measure?

Accepted Answer

Multiple dimensions of poverty

Answer

Only income poverty

Answer

Health and education outcomes

Question 41

Which of the following is a potential contributing factor to the feminization of poverty?

Accepted Answer

Women's lower earning potential

Answer

Increased female labor force participation

Answer

Lower female education levels

Answer

Higher male unemployment rates

Question 42

In the context of poverty reduction, what is the importance of empowerment?

Accepted Answer

It enables individuals to take control of their lives and improve their well-being

Answer

It guarantees access to essential goods and services

Answer

It ensures equal opportunities for all

Question 43

Which of the following is a potential impact of chronic poverty on children?

Accepted Answer

Impaired cognitive development

Answer

Increased earnings potential

Answer

Enhanced social mobility

Answer

Improved health outcomes

Question 44

Which income-based poverty line is absolute, rather than relative, to the living standards of a country?

Accepted Answer

World Bank poverty line

Answer

Purchasing Power Parity (PPP) threshold

Answer

Headcount ratio

Answer

Gini coefficient

Question 45

Which of the following is considered a structural cause of poverty?

Accepted Answer

Lack of access to education

Answer

Health issues

Answer

Natural disasters

Answer

Unemployment

Question 46

Which of the following policies is aimed at reducing poverty through cash transfers?

Accepted Answer

Conditional cash transfers

Answer

Progressive taxation

Answer

Minimum wage legislation

Question 47

Which of the following international organizations plays a major role in monitoring and reducing poverty worldwide?

Accepted Answer

World Bank

Answer

World Trade Organization (WTO)

Answer

International Monetary Fund (IMF)

Answer

United Nations Development Programme (UNDP)

Question 48

Which of the following is a limitation of using the headcount ratio to measure poverty?

Accepted Answer

It does not account for the depth or severity of poverty

Answer

It can be influenced by the choice of poverty line

Answer

It requires detailed household income data

Question 49

Which of the following is a key criticism of the multidimensional poverty index (MPI)?

Accepted Answer

It is complex and data-intensive to calculate

Answer

It does not consider the income of individuals

Answer

It relies on subjective indicators and can be biased

Answer

It cannot be used to compare poverty levels across countries