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In which situation may the condition of most people not improve even when per capita GDP rises?

Answer and explanation

Correct answer: When additional income goes to very few people

The governing concept is that per capita GDP is an average and does not show how income is distributed. It can rise when a small group receives most of the additional income, while the earnings and consumption possibilities of the majority remain unchanged. Therefore, option D is correct. Better education, lower pollution and higher employment generally support welfare rather than explain this failure.

Related tags

Per Capita GdpIncome DistributionWelfareAverage IncomeGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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