Question

Why is the per capita income of a country a better indicator of development than just the total income?

• A. Total income considers only the money value of goods produced.
• B. Per capita income reveals the income considering the population.
• C. Per capita income is calculated by comparing the total income of developed nations.
• D. Total income is calculated on a half-yearly basis.

Answer 1

The correct option is B Per capita income reveals the income considering the population.

Total income indicates the income of the whole country. It does not provide information about individual incomes of the people living in the country. On the other hand, per capita income considers the population of the country. Thus, it is a better indicator of development compared to total income.