Which of the Following Describes the Vicious Circle of Poverty

question 206

Multiple Choice

Which of the following describes the vicious circle of poverty?

• A)Government spending for public goods is inflationary, and this undermines incentives to save and invest.
• B)Higher incomes increase consumption at the expense of capital accumulation, which causes income to fall.
• C)Low per capita incomes cause low levels of saving and investment, which mean low productivity and therefore low incomes.
• D)A growing national income increases the demand for money, which increases the interest rate and reduces investment.

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Definitions:

Transgression

A geological event where the sea level rises relative to the land, causing the shoreline to move inland across the continent.

Regression

A statistical technique used to determine the strength and character of the relationship between one dependent variable and one or more independent variables.

Geographic Distribution

The manner in which a particular natural feature, population, or resource is spread out across the Earth's surface.

Eroded Away

The process by which natural forces remove and transport soil, rock, or other material from one location to another.