National and Per Capita Income AFCAT Questions

AFCAT Indian Economy

National and Per Capita Income MCQ Questions


13.
Which of the following is the correct formula for per capita income?
A.
Per Capita Income = Gross Domestic Product multiplied by Total Population
B.
Per Capita Income = National Income divided by Total (mid-year) Population
C.
Per Capita Income = Total Government Revenue divided by Number of Taxpayers
D.
Per Capita Income = Highest Individual Salary in the Country
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ANSWER :
B. Per Capita Income = National Income divided by Total (mid-year) Population
14.
Per capita income is most commonly used as a rough indicator of:
A.
The total geographical area of a country
B.
The literacy rate of a country's population
C.
The total foreign exchange reserves held by a country
D.
The average standard of living or average income level of a country's population
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ANSWER :
D. The average standard of living or average income level of a country's population
15.
A major criticism of per capita income as a measure of a typical citizen's standard of living is that it:
A.
Ignores how income is actually distributed among the population, so a country with very unequal income distribution could show a high average even if most people remain poor
B.
Is identical to a country's total GDP, with no difference whatsoever
C.
Always increases at exactly the same rate as the population
D.
Cannot be calculated for any country with a population over one billion
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ANSWER :
A. Ignores how income is actually distributed among the population, so a country with very unequal income distribution could show a high average even if most people remain poor
16.
If two countries have identical total national income but different population sizes, the country with the smaller population will have:
A.
A higher per capita income, since the same total income is divided among fewer people
B.
A lower per capita income, since smaller countries always have lower output
C.
A per capita income that cannot be calculated at all
D.
Exactly the same per capita income as the larger country
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ANSWER :
A. A higher per capita income, since the same total income is divided among fewer people
17.
If a country's population grows faster than its national income over a given period, then its per capita income will:
A.
Remain completely unaffected by any change in population
B.
Always grow faster than national income under all circumstances
C.
Grow more slowly than national income, and could even decline, despite national income itself rising
D.
Always grow exactly as fast as national income, regardless of population changes
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ANSWER :
C. Grow more slowly than national income, and could even decline, despite national income itself rising
18.
India's relatively moderate per capita income figure, despite having one of the largest total national incomes (GDP) in the world, is mainly explained by:
A.
India's national income being calculated in a foreign currency only
B.
India having the smallest geographical area among major economies
C.
India having no agricultural sector whatsoever
D.
India's very large population, which means a large total national income is divided among an exceptionally large number of people, lowering the average figure
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ANSWER :
D. India's very large population, which means a large total national income is divided among an exceptionally large number of people, lowering the average figure