Question 2 - Past Year Questions - 3 Marks - Chapter 1 Class 10 Economics - Development - Economics

‘‘Average income is useful for comparison but it may hide disparities.’’ Support the statement with suitable  arguments. 

(CBSE Delhi 2019) 

Answer:

Points to remember 

‘‘Average income is useful for comparison but it may hide disparities.’’ 

This is true because 

1. Equitable distribution is not ensured.
2. Doesn’t reflect income distribution among rich and poor.
3. HDI indicators are not considered.

Answer to be written:

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Per capita Income or Averages is not a reliable indicator of economic development because:

• Hides disparities .- If a small population has a very high income, the total income as well as the average income rises, thus hiding disparities about the actual situation.

• Doesn’t tell how income is distributed among people. There may be a very large number of poor people in society but only a handful of very rich persons. Per capita income will not reflect these differences.

• Doesn’t tell about the education, medical facilities, quality of the environment , and other services that influence the quality of life.

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