CSEET · Economic and Business Environment · National Income Accounting and Related Concepts
Per capita income of a country is calculated as:
Per capita income is National Income divided by the total population of the country. It shows the average income per person. Other denominators such as the labour force or households give different averages and are not the standard definition used in national income accounting.
- ANational Income divided by the total populationCorrect
- BNational Income divided by the labour force
- CPersonal Income multiplied by the population
- DGDP divided by the number of households
Explanation
Per capita income is the average income per person, found by dividing National Income by the mid-year population. Dividing by the labour force or households gives different averages, and multiplying by population gives a total, not an average.
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