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If elderly people form 20 percent of a region but labor-force participation among them is very high, which limitation of an age-based dependency ratio becomes clear?

Answer and explanation

Correct answer: It may overstate actual economic dependency

The governing concept is the distinction between demographic dependency and economic dependency. An age-based dependency ratio classifies people above a selected age threshold as dependents, usually because many are outside the labour force. It does not normally check whether each older person actually works, earns income, or receives support. If a large proportion of the elderly remain economically active, the age-based measure counts them as dependents even though they may support themselves and contribute to production or taxes. It can therefore overstate the real economic burden. Option B is correct. The other choices confuse counting, age categories, or the arithmetic meaning of a ratio.

Related tags

Age-Based DependencyEconomic DependencyElderly WorkersLabour ParticipationAge StructurePopulation CompositionGeographyClass 12 Mcq

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