IGCSE Development Studies: Specimen Questions with Answers 5 - 6 of 98

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Indicators Poverty in a Country

Question 5 (5 of 7 Based on Passage)

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Give three disadvantages of GDP as poverty indicator.

Explanation

Disadvantages of Using GDP as an Indicator of Economic Development Are

  • GDP can hide inequalities as it does not show the distribution of wealth
  • GDP can be manipulated by the governments of the country who show themselves as poor to collect more aid for various projects.
  • GDP does not include informal economies or subsistence level which is not an important factor in less developed countries.
  • GDP fails to indicate whether a country՚s progress is sustainable or not.
  • It does not consider environment quality, health and education levels of a country, advancement of technology, activities that are not conducted in the market, increase in the inequality gap etc.

Question 6 (6 of 7 Based on Passage)

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State the advantages of poverty indicators.

Explanation

Advantages of Poverty Indicators Are

  • Flexible: The poverty indicators are flexible they can be adopted to various purposes such as individual, household, groups communities or states.
  • Choice: With binary, qualitative and categorical data the measure can be constructed. For each indicator the weight and poverty cut off can be varied.
  • Identification: The identification of the poor՚s can be done easily and is transparent, as the number of dimensions rises its measurement will be focused on the poorest of all.
  • Effectiveness: The indicators of poverty are effective and can be applied to monitor and reduce the level of poverty over time.