MIDTERMS

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absolute poverty

absolute poverty

levels of incomes and expenditures that fall below a level

known as the “poverty line”

nominal value of which is adjusted to hold a fixed value of its purchasing power

relative poverty

sometimes called “inequality”

comparison of the incomes and expenditures of the poor with reference to the rich or of some other groups

agriculture sector

those who are considered the poorest normally work in the ______

they are uneducated, somehow labeled as illiterate, and mostly considered malnourished

poverty

is relative to the standard of living of one country

extreme poverty

characterized by those disadvantaged in basic living conditions, such as food, clean water, sanitation, housing, good health, and even to information

poverty rate

most common measure of poverty

poverty line

set by the government as the threshold to which the absolute value of income and expenses is compared to consider a family to be in poverty

subsistence incidence

part below the poverty line suffering from extreme hunger

inequality

oftentimes associated with poverty

wealth and income

2 major types of inequality

wealth inequality

uneven distribution of accumulated assets after deducting the liabilities

income inequality

income distributed in an uneven manner

indonesia

vietnam

cambodia

laos

countries that use expenditure-based measures of poverty

thailand

malaysia

philippines

countries that use income-based measures of poverty

poverty incidence

percentage of families or individuals with per capital income or expenditures less than the per capital poverty

poverty rate in the Philippines P=(n) x 100

lorenz curve

developed by American economist Max O. Lorenz in 1905

it is a curve showing the relationship between the population in percentile ranking and the national income

gini coefficient

the inequality gap is called _____ , a scalar metric of inequality that was introduced by Corrado Gini - who furthered enhanced the Lorenz curve

government

it plays an important role in reducing poverty in the country through its policies to improve the welfare of the people

pantawid pamilyang pilipino program

example of cash transfer

it aimed to help the poorest of the poor improve the health, nutrition and education of children

in-kind transfers

another way is to directly provide goods and services as social safety nets through specialized welfare programs

work incentives

commonly happen when a natural disaster occures, and those who are displaced in their workplaces are given to work and help rebuild the place of adversity

minimum wage law

act of congress or the senate that imposes a minimum payment of wage to workers

adjust tax code

intended not to collect any form of tax from individuals who earn a specific amount or less in one year

to collect more taxes from those who are earning more

poverty trap

a person experiences no advancement for working despite the government’s financial assistance even if it sounds to be very reasonable

eradication

main aim toward poverty

homelessness

one of the issues of poverty in the Philippines

healthcare

one of the main expenditures of a filipino family

quantitative

graphs, statistics

mathematical interpresentation

qualitative

observable features

documentary

The consumer price index (CPI)

is a statistic used to measure the total goods and services purchased and consumed by a household compared to a base year

Economic crashes

usually begin with the vicious cycle of higher prices and the expectations of higher prices that greatly affect the buying behavior of the people

vicious cycle

is any situation in which an action tends to bring about a further reaction that offsets any gain brought about by the initial action and exacerbates the initial problem

hyperinflation

When this happens, and the monthly inflation rate increases over 50% or around 13,000% per year,

stagflation

The condition when the production of goods and services slows down or is put to a halt or simply stagnates while the prices are rising is

Depression

The USA experienced the Great ___ in the 1930s, which started in 1929. There was a sustained decrease in the GDP

cost of living allowance (COLA)

is an adjustment applied to the income received by the employees to sustain the standard of living due to the inevitable rising prices or inflation

used to counter effect of inflation

The Philippine Statistics Authority (PSA)

conducts a Commodity and Outlet Survey (COS)' (the last survey of its kind was in 2007-2008) to understand the goods and service that each household in the country purchases or consumes, and the type of channels in the country wherein these are available

velocity of money

average number of times a currency is spent on purchasing goods and services

gdp

sum of the value

peso value of all final goods and services that are produced in one country in a year

laissez-faire

minimizing government intervention when it comes to pricing, free market

peso value

monetary value

final goods and services

finished goods do not include intermediate goods

lack of natural resources

leadership

productivity

income inequality

lack of capital

reasons for low gdp

within the country

domestically produced

one year

does not include goods and services that were included in another year

expenditure

income

value-added

3 methods of calculating the GDP

expenditure

an approach that summarizes the total expenses to buy final goods and services by household, firms and the government

GDP = C+I+G+(X-M)

income

an approach that summarize the compensation of employees, net interest, rental income, corporate profits, and income of other firms

GDP = TOTAL INCOME + SALES TAXES + DEPRECIATION + NET FOREIGN FACTOR INCOME

sales tax

the tax imposed on consumers for the sale of goods and services

depreciation

the cost allocated to capital assets over an estimated useful life

net foreign factor income

income that citizens make while abroad, less the income generated by foreigners in the country

difference between OFW income and foreigners income in our country

value-added

an approach most common type of GDP calculation method aim to calculate all parts of production

GDP = GVO - VIC

gross value of output

any stages of production must be included

ex. Work in process

value of intermediate consumption

the cost of all goods used to produce the final goods

ex. cost of capital

real gdp

calculate the value of final goods and services at constant price

based on planning & production

gdp inflator

used to measure the value of money in a country over a specific year

differences between real and nominal

nominal gdp

calculates the gdp through the value of final goods and services at the current market prices

based on inflation rate

gross national product

sum of all the finished goods and services produced by the citizens of a country overseas and domestically

net national product

sum of all the finished goods and services produced by the citizens of a country overseas and domestically less depreciation

national revenue

composed of all revenue sources to be used in national expenditures

personal revenue

sum of an individual’s or citizen’s earnings / basic salary

disposable personal revenue

sum of an individual’s or citizen’s earnings less current individual taxes

kingdom of bhutan

is known for its application of a unique metric for the nation’s wealth and well being

gross national happiness

bhutan believes that this is a more important tool to use than GDP

economically, this is founded on the basics that happy people live longer and thus will need less public health funding.

genuine progress indicator

alternative metrics

founded on the index of sustainable economic welfare and growth