Question

One of the most significant drawbacks of per capita income is that it fails to capture the true standard of living. Which of the following would be a more comprehensive indicator of well-being?

• A. Gross Domestic Product (GDP)
• B. Consumer Price Index (CPI)
• C. Purchasing Power Parity (PPP)
• D. The Human Development Index (HDI)

Answer 1

Answer:

D. The Human Development Index (HDI)

• The HDI is a composite index that measures a country's average achievements in three basic dimensions of human development: health, education, and standard of living.