Question

Why do you think per capita income is an advantageous method of comparing countries? What is its drawback?

Answer 1

Yes because per capita income is the total income of a country divided by its population.

It is used to classify countries which are developed or developing or needs development.

Drawbacks:-

It has a drawback as it hides disparities e.g. when a small section of people have high income the average income also gets high and don't give proper idea about the actual situation.

Answer 2

The PCI is a standard of measuring the national income but is not a true estimate of wealth of nations.

Explanation:

• PCI is the measure of the amount of money that is earned by a person in a national or geographic region.  It can be used to determine the income of an area to understand the living standards and quality of life of people.  

• This method can be measured by dividing the country's national income by the total population. It takes into account each and every member of the family. Per capita income is useful in accessing affordability.

Some limitations are seen in per capita income as:

• Since it uses all over incomes of the population and divided it by the total number of people. But does not provide accurate standards of living and does not gives us a true picture of living conditions.  

• Inflation is not reflected in PCI which is the rate of variation in prices over time. It does not give a clear picture of international comparison.

• The per capita income also does not include savings and wealth. The economic wealth of the nation is not necessarily captured.

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• brainly.in/question/17924722 answered by amitkumarswain2005.