Question

Only the per capital income cannot reflect the true state of economic development?Justify.

Answer 1

Explanation:

The per capita income can not reflect the true state of economic development because if the income of a particular group have increased or have become rich and the income of other groups remain the same, it will reflect an increase in the per capita income

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Answer 2

PER CAPITA INCOME

Per Capita Income is the average income of the population in a country. or the income of every person in the country. Or also the income distributed among the population.

It can be found by the following formula:

Per Capita Income = National Income / Population

The Fact that only the per capita income cannot reflect the state of economic development is because:

1. It only tells about the distribution of income among the population.
2. Development cannot be described only by the Income of the population but Life Expectancy, Literacy Rate, Infant mortality rate, e.t.c,.
3. Per capita income doesn't tell the concentration of money in the hands of poor and rich. For Example, If a country has high per capita income, Then It may mean that 80% of the income belongs to 20% population. So, It is clear that It doesn't tell you the concentration of income in the hands of poor or rich.

SOME INFORMATION:

Life Expectancy :-

It is average number of years that is expected to be lived by a person in a region.

Literacy Rate :-

Number of educated persons in a given age group, expressed as a percentage of the total population in that age group.

Infant Mortality Rate :-

Number of infants died before the age of 1 year as compared to the total number of infants born in that particular year.