Question

The standard of living in a country is represented by its:

• A. Poverty ratio
• B. Per capita income
• C. National income
• D. Unemployment rate

Hint:

Per capita income is a key indicator for comparing living standards between countries or over time.

Answer 1

The Correct Option is B

The standard of living refers to the level of wealth, comfort, material goods, and necessities available to individuals in a society.
It is best reflected through per capita income, which is the average income earned per person in a country.
Per capita income is calculated as: National Income divided by the total population.
This gives a clearer picture of how prosperous or developed a country is from the citizens’ perspective.
Now let’s evaluate the options:
(A) Poverty ratio — Measures the percentage of population below the poverty line, not overall living standards. ❌
(B) Per capita income — ✔️ Correct. It best represents the average standard of living of individuals in a country. ✅
(C) National income — Does not consider the population size; therefore, it is not a good indicator of living standards. ❌
(D) Unemployment rate — Indicates employment health but not comprehensive living conditions. ❌
Thus, the correct answer is option (B).