No country, including the United States (US), escapes the economic problem. The US has a high GDP per head. However, it also has a high degree of income inequality. There are both super‑rich billionaires and people living in poverty. In 2023, 12% of US households had one or more members who missed meals because they did not have enough money to buy sufficient food. Some argue that the rich should pay a very high rate of income tax.

2(a)Scarcity Choice Opportunity CostEasy2 marks

State why the economic problem exists.

2(b)Income Wealth InequalityHard4 marks

Explain two reasons for differences in income distribution between countries.

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2(c)Poverty Redistribution PolicyHard6 marks

Analyse how a government could increase the access of low‑income households to food.

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2(d)Taxation Public ExpenditureHard8 marks

Discuss whether or not a government should impose a high rate of personal income tax on the rich.

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