What do we mean by a satisfactory standard of living? Obviously, it must include the basic necessities of life such as food, clothing and shelter.
To obtain these necessities on a regular basis, a person must have a reliable income. But we have other needs which we would probably also describe as basic, for example, health and education facilities and security.
All of these we may define as our needs. But most of us would be far from satisfied if we had nothing more than these provided for us. We all en-joy having extra income to spend on things such as books, sports, or hob-bies. Sometimes we save some of this extra income to provide for future ex-penditure of this type on holidays, for example. So in addition to our basic needs, we must add our wants. Our standard of living is the degree to which these needs and wants are satisfied.