When poverty is defined by an relative real income level, what will happen to the poverty rate if the distribution of income is not perfectly equal?

Question

Quizplus · Accepted Answer

When poverty is defined by a relative real income level, the poverty rate will change as the distribution of income changes. If the distribution of income becomes more unequal, the poverty rate will increase. However, if policies and programs are put in place to reduce inequality and increase the incomes of the poorest, the poverty rate could decrease. Therefore, the poverty rate will change, but always exist.

When Poverty Is Defined by an Relative Real Income Level