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Poverty connotes indigenous wants and inferiority. Poverty is a state of being poor and being poor means needy and unproductive World Bank 1985 defined the poor as those whose average income is less than 370 dollars per annum, for the extremely poor their annual average income is less than 275 dollars.
Poverty is basically divided into two broad categories;
Relative poverty on the other hand as seen by Townsend in 1973 said that individuals and families are in poverty whose resources overtime fall seriously short of the resources commanded y the average individual or family in other community in which they live. Relative poverty is concerned with how well an individual is with respect to others in the same society or community.
Poverty gap measures the total amount of income necessary to raise anyone who is below the poverty line; it is the percentage of total consumption that will be needed by both the poor and the extremely poor above the poverty line.
This shows the extent to which income of the poor line, it is the amount of money per day that it will take to bring every poor person in the economy up to the defined minimum income standard
The average poverty gap is gotten on a per capital basis. The average poverty gap (APG) = total poverty gap/ population.
Often, we are interested in the size of the income short fall in relation to the poverty line. The normalized poverty gap (NPG) is gotten by NPG = APG/ income