Q.Explain any two limitations of per capita income as an indicator.

The experts of the United Nations Organization (UNO) recommended per capita income as an indicator of economic development — option (b).

Per capita income (PCI) = National Income ÷ Total Population. It measures the average income available to a person in a country and was long used as the simplest single indicator to compare the level of development between nations. A committee of experts appointed by the United Nations Organization recommended its use for …

Per capita income = national income of a year ÷ total population of that year; it is the average annual income of one person.

Per capita income (PCI) is the average income earned per person in a given area (a country or state) during a specified period, usually one year. It is calculated as:

$\text{Per capita income} = \frac{\text{National income of the year}}{\text{Total population of that year}}$

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