Question 1 - MCQ Questions (1 Mark) - Chapter 3 Class 9 Economics - Poverty as a Challenge - Economics

Name a method to estimate poverty line in India.

(a) Expenditure method

(b) Income method

(c) Both (a) and (b)

(d) Demand and supply

Answer:

So, the correct answer is (b).

Explanation:

• A common method used to measure poverty is based on income or consumption levels.
  
  
• A person is considered poor if his or her income or consumption level falls below a given “minimum level” necessary to fulfill basic needs.

Let’s check all the options

• (a) Expenditure method - The expenditure method is the most widely used approach for estimating GDP, which is a measure of the economy's outpu t produced within a country's borders irrespective of who owns the means to production. The GDP under this method is calculated by summing up all of the expenditures made on final goods and services. So, this is incorrect.
  
  
• (b) Income method - It is used to estimate the poverty line in India . So, this is correct.
  
  
• (c) Both (a) and (b) - The expenditure method is used to estimate national income whereas the Income method is used to estimate the poverty line in India. Both the options together can’t be used. So, this is incorrect.
  
  
• (d) Demand and supply - It is used to estimate the price of a commodity. So, this is incorrect.

Thus, option (b) is correct.