Q1. [1] medium thorough-understanding
Which of the following best explains why two countries with identical average per capita incomes can still differ significantly in their level of development?
((A)) Per capita income is calculated differently in each country
((B)) Income distribution, public expenditure on health and education, and social outcomes vary between countries
((C)) One country may have a larger population than the other
((D)) The currency exchange rates differ between the two countries
- A One country may have a larger total population than the other.
- B Average income hides how income is distributed and says nothing about health or education outcomes.
- C One country may export more goods than the other.
- D The currency exchange rates between the two countries differ.
Generated by claude-sonnet-4-6 · 2026-06-26 13:24 · grounding rag
Model Answer
Answer: (B) Average income hides how income is distributed and says nothing about health or education outcomes.
Two countries with the same per capita income can differ in development because income distribution may be unequal and health/education outcomes may vary significantly.
Source: Chapter 1, "How to Compare Different Countries or States?" / "Income and Other Criteria"
---
Explanation
- The textbook uses the example of Country A and Country B (Table 1.2), both with the same average income but very different distributions — this directly supports option B.
- Examiners look for the key idea: averages hide disparities in income distribution, and per capita income says nothing about health or education.
- Options A, C, and D are irrelevant to the concept of development as discussed in the chapter.
- Always link back to the UNDP/HDI argument: development requires looking beyond income at health and education indicators too.