Final answer:
Needs-based assistance aims to meet individuals' specific requirements, but if not structured carefully, it can lead to a phenomenon known as the poverty trap, where assistance disincentivizes work.
Step-by-step explanation:
Assisting people based on their actual needs refers to the practice of targeted assistance or needs-based assistance. It aims to provide support such as food, shelter, healthcare, and income in a manner that addresses individual circumstances. However, when considering how to assist individuals, it is important to be mindful of potential negative outcomes such as creating a poverty trap. This occurs when the provided assistance diminishes the incentive to work because any earned income results in an equal reduction in government support, leading to no net financial gain for the individual. Properly structured assistance programs seek to avoid this by tapering off support in a way that always makes work financially rewarding.