Question

Vicious Circle of Poverty and the Scarcity of Capital.​

Answer 1

Vicious Circle of Poverty and the Scarcity of Capital.​

Explanation:

Vicious circle of poverty and scarcity of capital is such that it explains the causal effect.

Poverty is a social issue that exists because of scarcity of resources. It is categorized as the basic economic problem. Scarcity means that there are not enough resources to satisfy the unlimited wants of people. There are only limited resources. This is why there are high rates of goods and services. There exists inflation. There is a problem of the income gap. Due to this, poverty exists and people are not able to earn enough for themselves.

There are some reasons,

• High population
• lack of finances, etc.

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Answer 2

Answer

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Unemployement is the biggest reason for poverty in the countries.

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The scarcity of capital :- Of all factors of economic development capital is regarded to be the most important. Infact, the accumulation of capital can help our country in its attempt to overcome its backwardness.

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Underdeveloped countries lakh sufficient capital resources. These countries have low rates of saving and capital formation due to widespread poverty.

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