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A country's total population is stable but the elderly population is growing while the working-age population is shrinking. What is the most likely economic effect?

Answer and explanation

Correct answer: Labor-force pressure and pension and health demand may rise

Total population does not reveal the full demographic situation. Age structure matters because different age groups create different needs and contribute differently to the labor force, tax revenue, care systems, and public services. If the elderly share rises while the working-age share falls, fewer workers may have to support more retirees and health-care needs.

Therefore, labor supply and possibly the tax base may come under pressure, while demand for pensions, medical care, and long-term support may increase. Option A is the most likely effect. A stable total population does not remove these pressures because the composition of the population is changing. School demand would not necessarily rise; with fewer younger people, it could remain stable or decline.

Related tags

Population AgeingWorking Age DeclinePension DemandLabor ForcePopulation GrowthThe World Population – DistributionDensity And GrowthThe World Population Distribution Density And Growth

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