a) Distinction between wealth and income inequality

• What is the difference between income and wealth?

  Income is a flow; wealth is a stock
• What does income inequality refer to?

  Uneven distribution of income
• Why is wealth likely to be more unequally distributed than income?

  Wealth can be accumulated over time
• How can wealthy individuals generate income?

  By generating income from their assets
• What happens when income exceeds expenditure for wealthy individuals?

  They can build up a stock of assets
• How can the accumulation of wealth occur over generations?

  Through inheritance of assets