We have given these Economics Class 12 Important Questions Indian Economy Chapter 4 Poverty to solve different types of questions in the exam. Go through these Poverty Class 12 Important Questions and Answers Solutions & Previous Year Questions to score good marks in the board examination.

Important Questions of Poverty Class 12 Indian Economy Chapter 4

Question 1.
Explain the meaning of poverty.
Answer:
Poverty may be defined as the inability to secure minimum human needs related to food, clothing, housing, education and health.

Question 2.
What do you understand by ‘Churning poor’?
Answer:
They are the people who regularly move in and out of poverty, e.g. Small farmers and seasonal workers.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 3.
How is head-count ratio calculated?
Answer:
The percentage of population below poverty line in a country is called head-count ratio.
Head-count Ratio =
Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4 Img 1

Question 4.
State how much minimum calories are prescribed for children below one year and adults performing heavy work?
Answer:
The minimum calories required for children below one year are 300 and for adults who perform heavy work, it is 3600.

Question 5.
Do you think that poverty has shifted from rural to urban areas? Why?
Answer:
The poverty has shifted from rural to urban areas because of the overflow of the rural poor who migrated to urban areas in search of alternative employment and livelihood.

Question 6.
State the most important reason of poverty in India.
Answer:
Rapidly rising population is the single most important reason of poverty in India.

Question 7.
Poverty alleviation programmes are targeted to rural areas. Why?
Answer:
The rural population is four times of urban population and poverty level is more in rural areas than urban areas. So, these programmes are targeted to rural areas.

Question 8.
Name two major programmes whose objective is to improve the food and nutritional value of the poor.
Answer:
Two major programmes that aim at improving the food and nutritional value of the poor are

  • Public Distribution System
  • Integrated Child Development Scheme

Question 9.
What is meant by ‘Food For Work’ Programme? (NCERT)
Answer:
Food For Work Programme was launched in 1977-78. Under this programme, the government gave work to poor people related to making of kutcha road, clearing debris, etc and gave foodgrains instead of wages. This programme was later restructured as National Food for Work Programme in 2001.

Question 10.
What programme has the government adopted to help the elderly people and poor and destitute women? (NCERT)
Answer:
The government has launched National Social Assistance Programme. Under this programme, elderly people who do not have anyone to take care of them are given pension to sustain themselves. Poor women, who are destitute and widows are also covered under this scheme.

Question 11.
According to which concept of poverty, you can assess the level of inequality in the country?
Answer:
Relative concept of poverty helps to assess the level of inequality in the country. As per this concept, a comparison between the income level of top 5-10% with the bottom 5-10% is made, which reflects the relative standard of poverty. This concept of poverty indicates the relative position of different segments of the population in the income hierarchy.

Question 12.
Write a short note on Gini Co-efficient.
Answer:
The Gini Co-efficient was proposed by Italian statistician Corrado Gini in 1912 as a measure of inequality of income and wealth, i.e. as a measure of relative poverty. The coefficient varies between 0 which reflects complete equality, and 1 which indicates complete inequality. India’s Gini Index is 0.339.

Question 13.
UNDP has identified two categories of poverty. State those categories.
Answer:
United Nations Development Programme (UNDP) has identified two categories of poverty which are explained below

  • Income poverty which arises due to lack of necessities of material well-being, and
  • Human poverty which is a denial of opportunity for living a tolerable life.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 14.
Explain the vicious circle of poverty with the help of a diagram.
Answer:
Vicious circle of poverty implies that poverty is the cause of poverty. There are many vicious circles of poverty. One of them is depicted below
Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4 Img 2

Question 15.
Give the difference between absolute poverty and relative poverty.
Answer:
Difference between absolute poverty and relative poverty

Basis Absolute Poverty Relative Poverty
Meaning Absolute poverty means that the person is not able to achieve a minimum level of consumption. Relative poverty means that a person is poor in comparison of certain other person.
Prevalent in This concept is prevalent in less developed countries. This concept is prevalent in developed countries.

Question 16.
Why calorie based norm is not adequate to identify the poor? NCERT
Answer:
Calorie based norm is not an adequate measure to identify poor people because of the reasons mentioned below

  • This system categorises poor in a single category and does not differentiate between poor and very poor.
  • This mechanism considers calories . intake as the only basis of determining poverty. It fails to consider factors such as healthcare, provision of clean drinking water, proper sanitation, basic education, etc.
  • This measure fails to explain social factors that cause poverty such as ill health, lack of access to resources, lack of civil and political freedom, etc.

Question 17.
How can creation of income earning assets address the problem of poverty? (NCERT)
Answer:
Creation of income generating assets implies resources like land, social networks, etc which encourage empowerment and community services, fixed public assets like wells, clinics, schools, bridges, etc which generate employment. The access to these assets and their use serve as a foundation for earning a livelihood, thereby addressing the problem of poverty.

Question 18.
Enumerate the main problems that are generally associated with poverty of the economy.
Answer:
Poverty in an economy is the result of

  • rapidly rising population
  • low productivity in agriculture
  • under utilised resources
  • low rate of economic development
  • price rise

Question 19.
Do you think that it is not possible to eradicate poverty completely?
Answer:
No, I do not agree that it is not possible to eradicate poverty completely. In the world as a whole, there are plenty of resources to produce food but still there is hunger. Poverty in the present day world is more of a question of inequitabie distribution of income and wealth. It is possible to eradicate poverty completely by complete re-distribution of existing resources and incomes.

Question 20.
Is there any relationship between unemployment and poverty? Explain. (NCERT)
Answer:
Poverty and unemployment usually go together. Those who fail to get employment become a burden on the limited family income and thus, per capita consumption level decreases.

Decrease in consumption levels further decreases an individual’s earning capacity and he is unable to come out of vicious circle of poverty. It has been observed that most of the poor are either unemployed or intermittently employed as casual labourers. Uncertainty of income does not enable them to meet their basic needs and they are thrown into poverty. Therefore, we can safely conclude that a high degree of positive correlation exists between poverty and unemployment.

Question 21.
Mention any four anti-poverty programmes launched by the government to eradicate poverty.
Answer:
Various schemes run by the Indian Government to eradicate poverty directly or indirectly are

  • National Food for Work Programme
  • Pradhan Mantri Gram Sadak Yojana
  • biational Social Assistance Programme
  • Pradhan Mantri Jan Dhan Yojana

Question 22.
Illustrate the difference between rural and urban poverty. Is it correct to say that poverty has shifted from rural to urban areas? Use the trends in poverty ratio to support your answer. (NCERT)
Answer:
Rural poor are the poor people residing in villages and small towns. The rural poor work mainly as landless agricultural labourers, cultivators with very small land holdings, landless labourers and tenant cultivators.

On the other hand, the urban poor are the poor people living in metros and big cities. Urban labourers do a variety of casual jobs, sell a variety of things on roadsides and are engaged in various other such activities. It can be seen from the given table that poverty ratio has shifted from rural to urban areas.

Years Rural (in%) Urban (in%) India (in%)
1973 – 74 56.4 49.0 54.9
2004 – 05 28.3 25.7 27.5

It is evident from the above table that rural poverty has declined significantly from 56.4% in 1973-74 to 28.3% in 2004-05 whereas, decline in urban poverty (from 49% to 25.7%) is not that significant. Moreover, the gap between the rural and urban poverty ratios which was around 7% in 1973-74 fell to just around 2% in 2004-05 again signifying the shift in poverty from rural to urban areas.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 23.
Discuss the measures which will help to bring growth in an economy.
Answer:
The different measures which will help to bring growth in an economy are
(i) Income distribution should be improved: The government should try to improve the mechanism of income distribution and try to reduce income inequalities with the help of fiscal and legislative measures. These are

  • Fiscal measures These measures relate to the provisions related to taxation and subsidy. The government should adopt progressive system of taxation in which the richer section of the society is charged with higher rate of taxes and tax exemption is given to those with low incomes. Also, money collected as tax from the rich can be used to give subsidies to the poor, thus ensuring equitable distribution of income.
  • Legislative measures These measures are implemented by passing laws and are mandatory for all those who fall under its purview.

(ii) Population control The government should try to control the population of the country which is rising at a very fast rate. Poverty cannot be eradicated unless and until population of the country is controlled. Inspite of a significant growth in the national income of the country, the per capita income remains low due to excessive rise in population. Population control will reduce the dependent members in a poor household and help them to improve their status.

(iii) Other measures

  • Development of agriculture and other allied activities.
  • Maintaining stability in the price level
  • Eradication of unemployment
  • Promoting labour intensive technique of production
  • Developing backward regions
  • Creating self-employment opportunities

Question 24.
Why are employment generation programmes important in poverty alleviation in India?
Answer:
In India, twin problems exist, i.e. poverty and unemployment. Poverty can effectively be eradicated only when the poor start contributing to growth by their active involvement in the development process. This can only be achieved by launching various employment schemes. Following points discuss the importance of employment generation programmes to eradicate poverty:

  • Nexus between unemployment and poverty There exists a deep nexus between unemployment and poverty. If employment opportunities are generated, then more people will be employed leading to rise in their income, which in turn will reduce poverty.
  • Availability of basic facilities With the rise in employment opportunities, income increases and poor people are able to get access to education, health facilities, proper sanitation, etc.
  • Creation of assets The employment generation programmes aim at creation of assets like water harvesting, irrigation facilities, construction of roads, construction of dams, etc. All these assets help in the social and economic development of the rural areas and hence, eradicate poverty.
  • Creation of skills An essential element of employment generation programmes is the formation of human capital by imparting skills to the unskilled labourers through training. This skill formation enhances income earning capability of poor people.

Thus, poverty alleviation programmes like Prime Minister Rozgar Yojana, Swarna Jayanti Shahari Rozgar Yojana, MNREGA etc have come into existence.

Question 25.
The three dimensional attack on poverty adopted by the government has not succeeded in poverty alleviation in India. Comment.
Answer:
The Government of India had launched a three dimensional approach to solve the problem of poverty. This approach aims to eliminate poverty through growth, poverty alleviation programmes and provision of minimum basic amenities to the people.

However, this approach has not helped to alleviate poverty from our country.
It can be justified from the points below

  • Problems like hunger, malnourishment, illiteracy and lack of basic amenities are still prevalent in India.
  • None of the poverty alleviation strategies resulted in any radical change in the ownership of assets, process of production and improvement of basic amenities to the needy.
  • Due to unequal distribution of assets, the benefits from poverty alleviation programmes have not actually reached the poor. Also, the amount of resources allocated for the poverty alleviation programmes is not sufficient.

Question 26.
Suppose you are a resident of a village, suggest a few measures to tackle the problem of poverty. (NCERT)
Answer:
As a resident of a village, a few measures which I would suggest to alleviate poverty from rural areas are as follows

  • Identifying the poorest of the poor who are in the most urgent need of assistance and ensuring that they are benefitted by various programmes.
  • Allocation of funds for poverty alleviation programmes must be increased.
  • Implementation of poverty alleviation programmes should be done by involving the village panchayat and local people.
  • Focus of schemes should be more on providing income generating assets which can provide sustainable income for the poor.
  • Vocational training should be provided to the youth to enable them to earn their livelihood.
  • Improved delivery mechanism should be put in place in schools so that the level of education is brought up to the required standards.
  • Credit facilities through banks and micro finance institutions should be provided to the people to save them from indebtedness to the exploitative moneylenders.
  • Farmers should be provided land for cultivation and irrigation. Also, warehousing and marketing facilities should be provided to small farmers.
  • Targeted Public Distribution System (PDS) should be adopted to provide food security to BPL families.
  • Committed government officials should be given the responsibility to implement the rural development programmes.

Multiple Choice Questions

Question 1.
Reason for chronic indebtedness among the poors.
(a) Poor work mainly as landless agricultural labourers
(b) Poor borrow money from lenders who charge high rates of interest
(c) The poor are highly vulnerable. They are not able to negotiate their legal wages from employers and are exploited
(d) Poors are landless. Even if some of them possess land, it is only dry or waste land.
Answer:
(b) Poor borrow money from lenders who charge high rates of interest
Hint:
Poor are unable to maintain debt payments, their accounts are suspended, and their total debt continues to grow because of interest that lead them into chronic indebtedness.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 2.
How economists identify the poor?
(a) On the basis of their wealth
(b) On the basis of their annual income
(c) On the basis of their occupation and ownership of assets
(d) On the basis of their savings
Answer:
(c) On the basis of their occupation and ownership of assets
Hint:
Many poor are landless. Even if some of them possess land, it is only dry or waste land. So, economists directly relate asset and ownership with poor, i.e. less asset and ownership means more poverty.

Question 3.
Why poor have very limited economic opportunities?
(a) As they lives in rural area
(b) Scarcity of funds
(c) Lack of basic literacy and skills
(d) All of these
Answer:
(d) All of these
Hint:
Literacy is the basic key to gain employment and to attain economic development. The poor lack basic literacy and skills and hence have very limited economic opportunities.

Question 4.
In pre-independent India, who was the first to discuss the concept of a poverty line?
(a) Dadabhai Naoroji
(b) V.K.R.V. Rao
(c) R.C. Desai
(d) Findlay Shirras
Answer:
(a) Dadabhai Naoroji
Hint:
One of the earliest estimations of poverty was done by Dadabhai Naoroji in his book, ‘Poverty and the Un-British Rule in India’. He formulated a poverty line ranging from ₹ 16 to ₹ 35 per capita per year, based on 1867-68 prices.

Question 5.
Amartya Sen, noted Nobel Laureate, has developed an index known as
(a) Poverty Gap Index
(b) Sen Index
(c) Squared Poverty Gap
(d) Income disparity Gap Index
Answer:
(b) Sen Index
Hint:
Amartya Sen, noted Nobel Laureate, has developed an index known as sen index. It is defined as the average poverty gap in the population as a proportion of the poverty line.

Question 6.
The official data on poverty is made available to the public by the
(a) NSSO
(b) Planning Commission
(c) Government of India
(d) None of the above
Answer:
(b) Planning Commission
Hint:
The Planning Commission acts in a formal, advisory role, making recommendations to the local legislative body. The most fundamental implementation tool is zoning.

Question 7.
Why per head availability of land for cultivation has steadily declined?
(a) Rapid growth of population and without alternative sources of employment
(b) Lands and water bodies are getting polluted due to excessive and improper use of agro-chemicals
(c) Drought has a massive impact on agriculture, land and on the ecosystem also
(d) All of the above
Answer:
(a) Rapid growth of population and without alternative sources of employment
Hint:
There is a fall in death rate and improvement in longevity; this leads to population growth and this continued population growth has resulted in pressure on land. With the rapid growth of population and without alternative sources of employment, the per head availability of land for cultivation has steadily declined leading to fragmentation of land holdings.

Question 8.
The government’s approach to poverty reduction was of dimensional.
(a) one
(b) two
(c) three
(d) four
Answer:
(c) three
Hint:
The.government’s approach to poverty reduction was of three dimensions. These dimensions are (i) Growth oriented approach, (ii) Poverty alleviation programmes and (iii) Providing minimum basic amenities.

Question 9.
Growth oriented approach was not much successful because
I. of population growth
II. of the green revolution exacerbated
III. there was unwillingness and inability to redistribute land
IV. of unequal distribution of land and other assets
(a) Only I
(b) I and II
(c) I, II and III
(d) I, II, III and IV
Answer:
(c) I, II and III
Hint:
Population growth has resulted in a very low growth in per capita income. The gap between poor and rich has actually widened. The green revolution exacerbated the disparities regionally and between large and small farmers. There was onwillingness and inability to redistribute land. Economists state that the benefits of economic growth have not trickled down to the poor.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 10.
Which is not belongs to poverty alleviation programmes?
(a) Rural Employment Generation Programme (REGP)
(b) Prime Minister’s Rozgar Yojana
(c) Swarna Jayanti Shahari Rozgar Yojana
(d) National Social Assistance Programme
Answer:
(d) National Social Assistance Programme
Hint:
National Social Assistance Programme was intiated in 1995 under the third approach, i.e. to providing minimum basic amenities.

Question 11.
In August 2005, the Parliament passed a new act to provide guaranteed wage employment to every rural household whose adult volunteer is to do unskilled manual work for a minimum of 100 days in a year. This act is known as
(a) Mahatma Gandhi National Rural Employment Guarantee Act
(b) Minimum Wages Act
(c) Minimum Wages Guarantee Act
(d) Rural Employment Guarantee Act
Answer:
(a) Mahatma Gandhi National Rural Employment Guarantee Act
Hint:
Under this Act, all those among the poor who are ready to work at the minimum wage can report for work in areas where this programme is implemented.

Question 12.
Which scheme was launched in 2001 to improve living condition of slum?
(a) Pradhan Mantri Awas Yojana
(b) Valmiki Ambedkar Awas Yojana
(c) Gramin Awas Yojana
(d) Rajiv Awas Yojana
Answer:
(b) Valmiki Ambedkar Awas Yojana
Hint:
The Valmiki Ambedkar Awas Yojana is a centrally sponsored scheme which aims to improve the living conditions of slum dwellers across India, hoping to transform the way of life in these slums.

Question 13.
Transient poor can be further categorised into
(a) absolute and relative
(b) churning and very
(c) absolute and occasionally
(d) churning and occasionally
Answer:
(d) churning and occasionally

Question 14.
British rule in India is to be considered as one of the major reason for poverty. Out of the following, find the correct reason for poverty due to British rule.
I. Industrial sector was destroyed
II. People forced to depend on agriculture
III. Poor depends on indebtness
IV. Farmers are compelled to sell their produce at low price
V. Charged high taxes
(a) I, II, III and IV
(b) I, II, IV and V
(c) I, II and V
(d) III, IV and V
Answer:
(b) I, II, IV and V
Hint:
British ruled over India for more than 200 years, they exploited India’s people and its resources as a result India became very poor. The reasons of Indian poverty include charging of high taxes, farmers were compelled to sell their produce at low price and majority of population depended on agriculture and industrial stagnation.

Poverty Class 12 Important Questions and Answers Indian Economy Chapter 4

Question 15.
United Nations Development Programme has identified two categories of poverty,
I. Income Poverty
II. Relative Poverty
III. Absolute Poverty
IV. Human Poverty
V. RuralPoverty
VI. Urban Poverty
(a) I and III
(b) I and IV
(c) II and III
(d) V and VI
Answer:
(b) I and IV
Hint:
UNDP has identified two categories of poverty which are
(i) Income poverty which arises due to lack of necessities of material well-being
(ii) Human poverty which is denial of opportunity for living a tolerable life.